Halkos, George and Papageorgiou, George (2008): Extraction of nonrenewable resources: a differential game approach. Published in: Archieves of Economic History , Vol. 1, No. XXI (2008): pp. 522.

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Abstract
Exploitation of non–renewable resources is an intensively studied field of environmental economics in the last century. Since the influential Hotelling’s paper a huge progress is made in the depletable resources literature. Although a variety of methodologies is used in that problem’s solutions a basic question of time inconsistency arises in the solution process. We show the sources of dynamical time inconsistency in a leader – follower game for which the buyer leads while the extractor follows and the players employ open loop strategies. Also we make use of Markovian informational structure, in a non – renewable resource Nash game, in order to extract strategies that are time consistent. Finally we enlarge the utility function space from the logarithmic utility to the utility functions that exhibits relative risk aversion with the same, with respect to time consistency, strategies.
Item Type:  MPRA Paper 

Original Title:  Extraction of nonrenewable resources: a differential game approach 
Language:  English 
Keywords:  Nonrenewable resources; time consistency; Markovian strategies; leaderfollower 
Subjects:  Q  Agricultural and Natural Resource Economics; Environmental and Ecological Economics > Q0  General > Q00  General C  Mathematical and Quantitative Methods > C7  Game Theory and Bargaining Theory > C70  General C  Mathematical and Quantitative Methods > C6  Mathematical Methods; Programming Models; Mathematical and Simulation Modeling > C61  Optimization Techniques; Programming Models; Dynamic Analysis Q  Agricultural and Natural Resource Economics; Environmental and Ecological Economics > Q3  Nonrenewable Resources and Conservation > Q30  General C  Mathematical and Quantitative Methods > C6  Mathematical Methods; Programming Models; Mathematical and Simulation Modeling > C60  General C  Mathematical and Quantitative Methods > C6  Mathematical Methods; Programming Models; Mathematical and Simulation Modeling > C62  Existence and Stability Conditions of Equilibrium C  Mathematical and Quantitative Methods > C7  Game Theory and Bargaining Theory > C72  Noncooperative Games 
Item ID:  37596 
Depositing User:  G.E. Halkos 
Date Deposited:  23. Mar 2012 13:42 
Last Modified:  12. Feb 2013 05:40 
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URI:  http://mpra.ub.unimuenchen.de/id/eprint/37596 