Externalities, Market Power, and Resource Extraction
This paper analyzes the effect of market power in a model with dynamic and biological externalities. When several countries harvest fish in international waters the evolution of fish population is affected by their joint action, thus, generating a biological and a dynamic externality. If there is trade in fish, the market-clearing prices depend on the harvesting and consumption decision made in every country. Therefore, market-clearing prices generate another type of interdependence. The planners' make their policy decision by taking account of various externalities.We find a subgame perfect Cournot-Nash equilibrium and the conditions under which it may be efficient. We also study the role of di®erent externalities in generating inefficiency.
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"Open access renewable resources: Trade and trade policy in a two-country model,"
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"Dynamic Externalities and Policy Coordination,"
CRIEFF Discussion Papers
9608, Centre for Research into Industry, Enterprise, Finance and the Firm.
- Manjira Datta & Leonard J. Mirman, . "Dynamic Externalities and Policy Coordination," Working Papers 97/11, Arizona State University, Department of Economics.
- Manjira Datta & Leonard Mirman, . "Dynamic Externalities and Policy Coordination," Working Papers 2132841, Department of Economics, W. P. Carey School of Business, Arizona State University.
- H. Scott Gordon, 1954. "The Economic Theory of a Common-Property Resource: The Fishery," Journal of Political Economy, University of Chicago Press, vol. 62, pages 124.
- DATTA, Manjira, 1994.
"Externalities and Price Dynamics,"
CORE Discussion Papers
1994006, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- Copeland, Brian R., 1990. "Strategic enhancement and destruction of fisheries and the environment in the presence of international externalities," Journal of Environmental Economics and Management, Elsevier, vol. 19(3), pages 213-226, November.
- Fischer, Ronald D. & Mirman, Leonard J., 1992. "Strategic dynamic interaction : Fish wars," Journal of Economic Dynamics and Control, Elsevier, vol. 16(2), pages 267-287, April.
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