Fischer, C. (2005). Competition in markets for depletable resources with setup costs Environmental and Resource Economics, 30(3):243--257.

Affiliated author

Carolyn Fischer
Publication year

2005

Journal

Environmental and Resource Economics

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This paper analyzes the impact on exhaustible resource markets of setup costs, a sparsely analyzed category of nonconvex production technologies. This paper proves that, even under idealized circumstances for competition, a competitive equilibrium will fail to exist in the presence of setup costs, for any utility and cost functions such that a planner would exploit exhaustible resource pools sequentially.