This paper investigates the effect of resource nationalism on the value of petroleum (crude oil and natural gas) reserves. We develop a framework for treating resource nationalism as political risk, and utilize data on reserve transactions (from John S. Herold) and political risk ratings (from...

This paper utilizes transaction-specific data on forward trading in the international petroleum market to test directly predictions from the theory of normal backwardation against information-based predictions of trader performance. With the ability to identify buyers and sellers, the authors...

This paper analyzes price adjustment in markets where trade takes place through both spot-market and long-term-contract transactions. The authors develop a model illustrating the role of the resulting two-price system in describing price adjustment to transitory shocks; persistence effects of...

Recent years have seen recurring international financial crises, as well as a tremendous rise in trading and speculation. How are the two related? Are speculators and trading responsible for market volatility? This paper presents a study of the Gulf Crisis of 1990–1991, examining the behavior...

This article examines product markets in which long-term contracts and spot transactions coexist. Such markets are characterized by "multiple-price systems," wherein adjustment to supply and demand shocks occurs through spot prices, while contract prices are fixed or adjust slowly. The authors...