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Author
Date
2010-10Type
- Working Paper
ETH Bibliography
yes
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Abstract
The Hotelling rule argues that the price for a nonrenewable resource adjusts to the shadow value of the resource, reflecting the remaining availability of the resource. We empirically test the Hotelling rule on the effect of unanticipated oil field discoveries. We do not find evidence for a significant adjustment of the price of crude oil to news about greater resource availability and therefore conclude that the price for crude oil does not follow the theoretically optimal price path. Show more
Permanent link
https://doi.org/10.3929/ethz-a-006184358Publication status
publishedJournal / series
Economics Working Paper SeriesVolume
Publisher
ETH Zurich, Center of Economic Research (CER-ETH)Subject
Nonrenewable resource; Oil price; Exhaustible resources; Information acquisitionOrganisational unit
03635 - Bretschger, Lucas (emeritus) / Bretschger, Lucas (emeritus)
02045 - Dep. Geistes-, Sozial- u. Staatswiss. / Dep. of Humanities, Social and Pol.Sc.
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ETH Bibliography
yes
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