Strategic resource dependence

A-Tier
Journal: Journal of Economic Theory
Year: 2011
Volume: 146
Issue: 2
Pages: 699-727

Score contribution per author:

2.011 = (α=2.01 / 2 authors) × 2.0x A-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

We consider a situation where an exhaustible-resource seller faces demand from a buyer who has a substitute but there is a time-to-build delay for the substitute. We find that in this simple framework the basic implications of the Hotelling model (1931) are reversed: over time the stock declines but supplies increase up to the point where the buyer decides to switch. Under such a threat of demand change, the supply does not reflect the current resource scarcity but it compensates the buyer for delaying the transition to the substitute. The analysis suggests a perspective on costs of oil dependence.

Technical Details

RePEc Handle
repec:eee:jetheo:v:146:y:2011:i:2:p:699-727
Journal Field
Theory
Author Count
2
Added to Database
2026-01-25