Abstract

  


 



Optimal Exploration and Consumption of a Natural Resource Deterministic Case


N. A. Derzko


University of Toronto

Suresh Sethi


University of Texas at Dallas - Naveen Jindal School of Management
1981

Optimal Control Applications & Methods, Vol. 2, pp. 1-21, 1981

Abstract:     
An exploration and consumption model for exhaustible natural resources is used to formulate a deterministic optimal control problem over an infinite time horizon. A dynamic programming approach is employed throughout. The non-linear partial differential equation which results from an application of the necessary conditions is solved analytically by the method of characteristics. Several properties of the solution are discussed.

Keywords: Optimal exploration and consumption, exhaustible natural resources, economic models, dynamic programming

JEL Classification: Q3, C61

Accepted Paper Series


Date posted: June 22, 2009  

Suggested Citation

Derzko, N. A. and Sethi, Suresh, Optimal Exploration and Consumption of a Natural Resource Deterministic Case (1981). Optimal Control Applications & Methods, Vol. 2, pp. 1-21, 1981. Available at SSRN: http://ssrn.com/abstract=1421952

Contact Information

Nicholas Derzko
University of Toronto ( email )
Toronto, Ontario
Canada
Suresh Sethi (Contact Author)
University of Texas at Dallas - Naveen Jindal School of Management ( email )
800 W. Campbell Road, SM30
Richardson, TX 75080-3021
United States
Feedback to SSRN (Beta)


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