Optimal Contracts for Exploration with Cost Recovery of an Exhaustible Natural Resource Under Asymmetric Information Report as inadecuate




Optimal Contracts for Exploration with Cost Recovery of an Exhaustible Natural Resource Under Asymmetric Information - Download this document for free, or read online. Document in PDF available to download.

Exploration of an exhaustible resource with cost recovery under asymmetric information about cost is modeled and analyzed employing Principal-Agent theory. Allocation of lower than full information level of effort for the high-cost firms is found socially optimal. However, distortion is less in a two-stage process of exploration and extraction.

Subject(s): Resource /Energy Economics and Policy

Issue Date: 2006

Publication Type: Working or Discussion Paper

PURL Identifier: http://purl.umn.edu/28578

Total Pages: 18

Series Statement: Working Paper WP 06-05

Record appears in: University of Maryland > Department of Agricultural and Resource Economics > Working Papers





Author: Helal, Uddin ; Rahman, Shaikh Mahfuzur

Source: http://ageconsearch.umn.edu/record/28578?ln=en







Related documents