Extraction capacity and the optimal order of extraction

The least-cost-first extraction rule for deposits with different extraction costs previously has been shown to be invalid in general equilibrium. This paper demonstrates that this rule also does not hold in partial equilibrium when extraction capacity is limited. Necessary and sufficient conditions for several surprising extraction orders are presented. If extraction from a high-cost resource is constrained, it may be optimal to begin extraction from a high-cost deposit (or backstop) strictly before extracting from a lower-cost deposit. If extraction from a low-cost resource is limited, it may be optimal to exhaust a high-cost deposit strictly before the low-cost deposit is exhausted or to abandon extraction temporarily from a high-cost deposit and then to exhaust it later. The analysis demonstrates how extraction constraints affect the order of extraction and shows that certain cost reversals are caused by limited extraction capacity rather than by the general equilibrium definition of extraction costs.     

On equilibrium in resource markets with scale economies and stochastic prices

In this paper, I show the existence and the characteristics of equilibrium in a non-renewable resource market where extraction costs are non-convex and market price is subject to stochastic shocks, an empirically relevant setting. In my model firms may be motivated to hold inventories to facilitate production smoothing, which allows them to continue producing at a smooth pace at any instant when extraction ceases, e.g. when reserves are exhausted. This aspect of the model then supports a competitive equilibrium in the presence of non-convex costs. Casual empirical evidence is provided that supports the central features of my model for a variety of non-renewable resources, lending credence to the explanation for equilibrium I propose.     

On equilibrium in resource markets with scale economies and stochastic prices

In this paper, I show the existence and the characteristics of equilibrium in a non-renewable resource market where extraction costs are non-convex and market price is subject to stochastic shocks, an empirically relevant setting. In my model firms may be motivated to hold inventories to facilitate production smoothing, which allows them to continue producing at a smooth pace at any instant when extraction ceases, e.g. when reserves are exhausted. This aspect of the model then supports a competitive equilibrium in the presence of non-convex costs. Casual empirical evidence is provided that supports the central features of my model for a variety of non-renewable resources, lending credence to the explanation for equilibrium I propose.     

A free lunch in the commons

We derive conditions under which raising costs through a regulatory constraint or a fully expropriated tax can increase the profits arising from a common-pool resource. The basic model assumes a fixed number of identical agents with linear costs selling in a single period at an exogenous price. A necessary and sufficient condition for a cost increase to be profitable is that aggregate output from the resource be locally convex in aggregate effort. We also show that cost increases can be profitable even if price is endogenous, agents are heterogeneous, entry is costless, or agents are playing a Markov-perfect equilibrium of a dynamic game. We also discuss more general welfare implications of the result along with its relation to existing results for a Cournot oligopoly.     

Subgame-perfect cooperative agreements in a dynamic game of climate change

We model climate change as a dynamic game and prove existence of a unique subgame-perfect Nash equilibrium (SPNE) that is also Markov perfect. We interpret this unique SPNE as the business-as-usual (BAU) equilibrium and show that if the countries are not sufficiently symmetric then the familiar trigger strategy equilibria may not be Pareto improvements over the BAU equilibrium and may even lack efficiency properties. We then motivate and introduce a subgame-perfect cooperative agreement as an improvement over the BAU equilibrium in the sense that every country or coalition of countries is better off in every subgame, irrespective of the extent of heterogeneity of the countries. We characterize subgame-perfect cooperative agreements and identify sufficient conditions for their existence. We show that (direct or indirect) transfers between countries to balance the costs and benefits of controlling climate change are a necessity and not a matter of approach.     

The optimal tax for maximum economic yield: Fishery regulation under rational expectations

This paper examines the optimal tax to achieve maximum economic yield (MEY) exploitation in a rational expectations model of a competitive open-access fishery. To analyze the dynamic evolution of resource use a structural model which explains the relationship between the firm and the industry is presented. The unregulated equilibrium is contrasted with the potential MEY. Conditions under which the unregulated equilibrium will be MEY are explored. In addition, a tax is devised which will cause non-MEY competitive exploitation to become MEY when the tax is implemented.     

Exhaustible Resource Allocation in an Overlapping Generations Economy

This paper analyzes competitive allocations of an exhaustible resource in an overlapping generations economy. Conditions are given for the existence of equilibrium extraction rules such that both extraction and investment in future stocks are increasing and continuous in the current stock. The paper then considers the time paths of equilibrium allocations and shows that there are economies where equilibrium resource extractions and prices exhibit nonclassical behavior. This is illustrated through a finite horizon example in which extractions increase and prices decrease over the entire time horizon and an infinite horizon example where there are persistent cycles in extractions and prices and multiple equilibria. The paper concludes by examining welfare issues.     

The taxation of nonreplenishable natural resources revisited

The theory of nonreplenishable resource extraction has been extended to allow for extraction costs which increase as deposits are increasingly depleted. In these cases, profit maximization may result in the cessation of extraction before reserves are totally exhausted. The effect of various taxation policies on optimal extraction patterns in these models are derived. With a few exceptions, the results are that the imposition of a tax will cause operators to extract at faster rates over shorter periods of time and to reduce the total amount of ore extracted. The analysis allows for an output price which increases over time.     

氨基苯甲酸稀溶液的络合萃取研究

本文利用三辛胺或磷酸三丁酯为络合剂,正辛醇或煤油为稀释剂,在不同的Ｐ则定了氨基本甲酸稀溶液的萃取相平衡分配系数,讨论了影响因素,提出了同时考虑络合萃取作用和物理萃取作用的平衡分配系数的表达式。     

Environmental conflicts in mineral development

In the 1980s conflicts over the extraction and use of natural resources will increase. While some of these controversies are unavoidable, many are manufactured when people choose inappropriate methods for responding to problems. This paper explores five ways industry creates its own problems and how it can avoid doing so. They are: failure to provide adequate information to the public; relying on stereotypes in making decisions; ignoring a problem, hoping that it will disappear; assuming that technical solutions are sufficient to solve a problem; depending on archaic techniques for conducting business with the public. Specific tools for managing environmental conflict are suggested.     

Impact of gasoline engine deposits on light duty vehicle emissions: in-use case study in Beijing, China

Tailpipe emissions from light-duty gasoline vehicles usually deteriorate over time. The accumulation of engine deposits due to inadequate gasoline detergency is considered to be one of the major causes of such emission deterioration. Six in-use light-duty gasoline vehicles in Beijing were tested to investigate the impact of engine deposits on emissions of hydrocarbons (HC), carbon monoxide (CO) and nitrogen oxides (NO _x ). Emissions under cold start and hot running test conditions from the six light duty vehicles were measured before and after engine deposits were removed. Results show that although individual vehicles reacted differently for each of the pollutants, elimination of engine deposits on average reduced HC emissions under hot running conditions by 29.4%, CO emissions under cold start conditions by 23.0% and CO emissions under hot running conditions by 35.5% (t < 0.05 in all cases). No pollutant emissions increased with statistical significance (t < 0.05) after the removal of engine deposits. Variations of emission changes upon removal of engine deposits were observed. Such variations are in line with previous studies, implying that the impact patterns of engine deposits on vehicle emissions may be subject to many influencing factors that are not fully understood and difficult to control under all conditions. A statistical view of the impact of engine deposits on vehicle emissions may be appropriate for evaluation of emissions reductions across a city or a country. It is necessary to maintain sufficient and effective gasoline fuel detergency in practice to keep the engines clean and in turn reduce vehicle emissions.     

Global justice and the opportunity costs of conservation

Opportunity costs can represent a significant portion of the costs associated with conservation projects and frequently outstrip other kinds of cost. They are typically understood to refer to the benefits someone would have obtained if conservation projects had not required them to give up current activities, such as farming or hunting or if the land had been available for uses other than conservation. This familiar way of identifying opportunity costs is flawed, however, because it threatens to condone, or take advantage of, the injustices that many people face that affect their opportunities. I integrated ideas from the political theory of global justice to examine how the analysis of opportunity costs illustrates the importance of considering conservation and issues of global justice together, rather than thinking about them in isolation. I distinguish four baselines for defining opportunity costs. A status quo baseline defines opportunity costs by asking what people would have earned had a conservation project not happened. A willingness to accept baseline defines them by asking people what it would take to make them indifferent to whether a conservation project takes place or not. An antipoverty baseline suggests that opportunity costs have been met when people affected by a project are not left in poverty. An egalitarian baseline suggests opportunity costs have been met when people are not left in relative disadvantage, with worse than average opportunities. I argue that the egalitarian baseline is the most acceptable from the point of view of justice. Such a baseline would suggest that, in practice, many of the world's poor are being unjustly treated, or even exploited, as a result of conservation activities.     

Flattening the carbon extraction path in unilateral cost-effective action

Internalizing the global negative externality of carbon emissions requires the flattening of the extraction path of world fossil energy resources (=world carbon emissions). We consider governments with sign-unconstrained emission taxes at their disposal and seeking to prevent world emissions from exceeding some binding aggregate emission ceiling in the medium term. Such a ceiling policy can be carried out either in full cooperation or by a sub-global climate coalition. Unilateral action has to cope with carbon leakage and high costs, which makes a strong case for choosing a policy that implements the ceiling in a cost-effective way. In a two-country, two-period general equilibrium model with a non-renewable fossil-energy resource, we characterize the unilateral cost-effective ceiling policy and compare it with its fully cooperative counterpart. We show that with full cooperation there exists a cost-effective ceiling policy in which only first-period emissions are taxed at a rate that is uniform across countries. In contrast, the cost-effective ceiling policy of a sub-global climate coalition is characterized by emission regulation in both periods. The share of the total stock of energy resources owned by the sub-global climate coalition turns out to be a decisive determinant of the sign and magnitude of unilateral cost-effective taxes.     

Market design in cap and trade programs: Permit validity and compliance timing

Cap and trade programs have considerable heterogeneity in permit validity and compliance timing. For example, permits have different validities across time (e.g., banking, borrowing, and seasons) and space (e.g., zonal restrictions), and compliance timing can be annual, in overlapping cycles, or in multi-year periods. We discuss nine prominent cap and trade programs along these dimensions and construct a general model of permit validity and compliance timing. We derive sufficient conditions under which abatement is invariant to compliance timing, i.e., compliance timing cannot smooth abatement cost shocks. Under these conditions, (i) expected compliance costs are invariant, (ii) the variance of compliance costs increases with the delayed compliance, (iii) equilibrium prices may not be unique, and (iv) the delayed compliance equilibrium may rely on “degenerate” prices not determined by marginal abatement costs. We demonstrate the model's broad applicability by illustrating different types of temporal permit validity.     

Sequential development and exploitation of an exhaustible resource: do monopoly rights promote conservation?

This paper explores the problem of sequential exploitation of exhaustible resources by a monopolist, when a setup cost must be incurred to access the next pool. Under certain circumstances, the monopolist will always follow a more conservationist path of extraction and delay the introduction of new resource pools compared to a social planner. However, with other forms of consumer demand, the monopolist may exhaust the resource more quickly, especially if many new options will follow. These results may apply especially to depletable resources like antibiotics or biotech products, for which significant research and development costs are required, followed by monopoly rights conferred by patents.     

Exploration,information, and regulation in an exhaustible mineral industry

The paper presents a model of exploration and production in an uncertain environment. Exploration provides a by-product of information that helps predict future finds more accurately. When this information is not equally valued (at the margin) by society and industry, socially inefficient levels of exploration are chosen by industry. In this event, government intervention may be warranted. A regulator could control future prices to encourage industry to select socially preferred levels of production and exploration. Alternatively, by making public varying amounts of exploration information, incentives to industry could be adjusted. Conditions where such regulation might yield sufficient gains to society to offset regulatory costs are considered.     

芳香酸稀溶液的络合萃取研究

络合萃取法分离极性有机物稀溶液具有高效性和高选择性。本文利用三辛胺或磷酸三丁酯为络合剂,四氯化碳、三氯甲烷、正辛醇或煤油为稀释剂,实验测定了苯甲酸、邻硝基苯甲酸稀溶液的萃取相平衡分配系数,讨论了影响因素。     

Environmental aspects of mineral sand mining in Australia

The operations of the heavy mineral sand mining industry in Australia are reviewed, with particular emphasis on the environmental aspects. Pre-mining environments, state and commonwealth legislative requirements, mining procedures and postmining rehabilitation and land use are described. The extraction of heavy minerals, principally rutile, zircon, ilmenite and monazite, is concentrated on the east coast between the Hawkesbury River in New South Wales and Rockhampton in Queensland; and on the west coast at Capel, south of Perth and at Eneabba, north of Perth. The industry, especially on the east coast, has suffered from conservationist and anti-mining movements during the 1970s because it operates on or near the coastline where the majority of Australians live or seek their recreation. This was less of a problem on the west coast because the deposits were inland. The future of the industry is good as long as a balance can be maintained between the interests of conservationists and the mining companies.     

Prices vs quantities with multiple pollutants

We examine the choice of policy instruments (price, quantity or a mix of the two) when two pollutants are regulated and firms' abatement costs are private information. Whether abatement efforts are complements or substitutes is key determining the choice of policies. When pollutants are complements, a mixed policy instrument with a tax on one pollutant and a quota on another is sometimes preferable even if the pollutants are identical in terms of benefits and costs of abatement. Yet, if they are substitutes, the mixed policy is dominated by taxes or quotas.     

Sterilisation and safeguarding of mineral deposits in Britain

This paper gives a detailed account, from a British viewpoint, of the sterilisation of mineral deposits by development and of approaches that can be adopted to safeguard mineral resources in the long term. The ways in which mineral deposits can become sterilised are discussed along with an account of sterilisation trends. Policies on avoidance of sterilisation and safeguarding are traced from their origins through to the present day. Central and local government roles are examined along with responsibilities of those in the mineral industry.Following policy approaches there is consideration of how widely policies have been implemented in practive and how far these approaches to implementation match the aims on safeguarding. Emphasis is placed upon mineral consultation areas and their definition and operation, though landbanks and prior extraction are also considered. Finally, discussion brings out some salient points which form the basis of some concluding recommended courses of action.