Abstract
This dissertation focuses upon the economics of international trade in the presence of exhaustible natural resources. Resources and trade present an abundance of interesting questions, many of which have not yet been addressed in the current body of literature. This dissertation specifically examines two aspects of international trade and exhaustible resources. The first area of analysis is concerned with the effects of tariffs, export taxes and discovery of new resource reserves in a world of perfect certainty. A general equilibrium, international trade framework is used, which is the proper modeling approach for studying the interaction of two large trading countries. The second topic considered concerns a small price-taking country making plans in a world of uncertain resource price paths. The optimal resource extraction plan under uncertainty is compared with the solution forthcoming when price is known with certainty to attain the mean price path. Conclusions arising from the general equilibrium framework center around the terms of trade effects of various parameter changes. Reserve discovery in the resource rich country will always change the terms of trade in favor of the raw material importer. Welfare analysis reveals that utility in the resource poor country will be increased as a result of the favorable terms of trade effect. Interestingly, it is unclear whether the resource rich economy gains or loses as a result of a discovery in its own country. The effects of tariffs and export taxes are also clearly spelled out, with conclusions hinging upon whether or not the industrialized economy entirely exhausts its reserves. The second major topic of this dissertation involved resource price uncertainty. In the absence of international borrowing and lending, it was shown that resource price uncertainty leads to a faster rate of resource depletion than would occur in a world of perfect foresight.
Barney, Lloyd Dwayn (1984). A theoretical analysis of international trade with exhaustible natural resources. Texas A&M University. Texas A&M University. Libraries. Available electronically from
https : / /hdl .handle .net /1969 .1 /DISSERTATIONS -424505.