Externalities, market power, and resource extraction

Manjira Datta, Leonard J. Mirman

Research output: Contribution to journalArticle

31 Citations (Scopus)

Abstract

This article analyzes the effect of market power in the presence of 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, the market-clearing prices depend on the harvesting and consumption in all countries. Therefore, market-clearing prices also generate an externality. We find a subgame perfect Cournot-Nash equilibrium and study the conditions under which it may be efficient. We also analyze the role of different externalities in generating inefficiency.

Original languageEnglish (US)
Pages (from-to)233-255
Number of pages23
JournalJournal of Environmental Economics and Management
Volume37
Issue number3
DOIs
StatePublished - May 1999

Fingerprint

market
resource
fish
externality
Resource extraction
Market power
Externalities
Fish
Market clearing
water
price
Dynamic externalities
Cournot-Nash equilibrium
Harvest
Water
Inefficiency
consumption
harvest
effect

Keywords

  • Efficiency
  • Externality
  • Market power
  • Tragedy-of-the-commons

ASJC Scopus subject areas

  • Economics and Econometrics
  • Management, Monitoring, Policy and Law

Cite this

Externalities, market power, and resource extraction. / Datta, Manjira; Mirman, Leonard J.

In: Journal of Environmental Economics and Management, Vol. 37, No. 3, 05.1999, p. 233-255.

Research output: Contribution to journalArticle

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