This course reviews the literature on the pricing of natural resources (agricultural goods, renewable and nonrenewable resources and durables) over time. The first half of the course considers resources which are privately owned; the second half considers resources that are common property. To provide a point of reference, the behavior of resource markets in the absence of government intervention is studied first. There is then an extensive treatment of the dynamic effects on market equilibria of widespread government policies (unanticipated, partially anticipated or fully anticipated). Policies analyzed include: bufferstocks used to affect prices (ceilings, floors, bands, and pegs); bans, embargoes, price controls and whatever else is timely or of interest to participants. To simplify the mathematics, discrete-time methods are used predominately. The Kuhn-Tucker theorem is utilized when studying competitive equilibrium under certainty. Dynamic-programming is used to study single-agent (planning or monopoly) problems under uncertainty (with or without learning). Multi-stage game theory is used to investigate dynamic common-property problems. A working understanding of these methods is developed during the course.
Advanced Natural Resource Economics
Pass/Fail or S/U optional
ECON,Intermediate economic theory