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Appropriation of common access natural resources through exploration: A differential game of a claiming rush

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  • Mohr, Ernst

Abstract

This paper provides a model of natural resource exploration, where the sole motivation to explore arises from a strategic incentive to preempt competitors. It is assumed that private ownership rights over a finite unexplored and commonly held resource stock can be established through a costly deterministic exploration process. The open-loop and the feedback Nash equilibrium is analysed. It is shown that in between intervals of soaring exploratory activities there may be an interval where exploration is declining over time.

Suggested Citation

  • Mohr, Ernst, 1985. "Appropriation of common access natural resources through exploration: A differential game of a claiming rush," Discussion Papers, Series I 206, University of Konstanz, Department of Economics.
    • Handle: RePEc:zbw:kondp1:206
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    References listed on IDEAS

    as
    1. Arrow, Kenneth J. & Chang, Sheldon, 1982. "Optimal pricing, use, and exploration of uncertain natural resource stocks," Journal of Environmental Economics and Management, Elsevier, vol. 9(1), pages 1-10, March.
    2. Deshmukh, Sudhakar D & Pliska, Stanley R, 1980. "Optimal Consumption and Exploration of Nonrenewable Resources under Uncertainty," Econometrica, Econometric Society, vol. 48(1), pages 177-200, January.
    3. Pindyck, Robert S, 1978. "The Optimal Exploration and Production of Nonrenewable Resources," Journal of Political Economy, University of Chicago Press, vol. 86(5), pages 841-861, October.
    4. Pindyck, Robert S, 1980. "Uncertainty and Exhaustible Resource Markets," Journal of Political Economy, University of Chicago Press, vol. 88(6), pages 1203-1225, December.
    5. repec:bla:econom:v:51:y:1984:i:23:p:235-52 is not listed on IDEAS
    6. Sinn, Hans-Werner, 1981. "The theory of exhaustible resources," Munich Reprints in Economics 19910, University of Munich, Department of Economics.
    7. Richard J. Gilbert, 1979. "Optimal Depletion of an Uncertain Stock," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 46(1), pages 47-57.
    8. repec:bla:econom:v:51:y:1984:i:204:p:393-400 is not listed on IDEAS
    9. Reinganum, Jennifer F & Stokey, Nancy L, 1985. "Oligopoly Extraction of a Common Property Natural Resource: The Importance of the Period of Commitment in Dynamic Games," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 26(1), pages 161-173, February.
    10. John M. Hartwick, 1983. "Learning about and Exploiting Exhaustible Resource Deposits of Uncertain Size," Canadian Journal of Economics, Canadian Economics Association, vol. 16(3), pages 391-410, August.
    11. Gilbert, Richard J, 1977. "Resource Extraction with Differential Information," American Economic Review, American Economic Association, vol. 67(1), pages 250-254, February.
    Full references (including those not matched with items on IDEAS)

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