Kenneth R. Stollery

Mineral depletion with cost as the extraction limit: A model applied to the behavior of prices in the nickel industry

Abstract This article follows papers by Pindyck and Heal and Barrow in applying a Hotelling-type depletion model to a particular resource industry: in this case that of nickel. By means of the model the resource rent per ton of nickel is calculated as the proper index of extractive resource scarcity. The time path of this resource rent indicates that the model explains industry behavior well and that, as in the two previous studies, depletion has been an important determinant of prices and rents in this industry.

Estimating Willingness to Pay for Improved Water Quality in the Presence of Item Nonresponse Bias

This article deals with the problem of item nonresponse in contingent valuation surveys using a payment-card method, by applying a grouped-data sample-selection estimation technique that is capable of imputing the missing values conditional upon a respondents decision to answer a willingness-to-pay question. The advantage of the technique lies in its ability to utilize all of the information in the sample, permitting a more efficient estimation in the presence of item nonresponse bias. The major determinants of willingness to pay appear to be household income, number of children, education, perception of existing water quality, and identification with environmental issues. Copyright 2003, Oxford University Press.

Constant utility paths and irreversible global warming

This paper shows that the Hartwick rule for sustainable utility with depletable resources still applies to the case of the greenhouse effect from fossil fuel carbon emissions. Although a carbon tax is necessary, for sustainable utility it is sufficient that the sum of net energy rents and carbon tax revenues is invested in reproducible capital. Examination of recent savings rates and energy cost shares suggests that this may be difficult to achieve with current global savings rates.

Exchange rate pass-through and its determinants in Canadian manufacturing industries

In this paper the pass-through of exchange rate changes into the real prices of domestically produced and imported goods in Canadian manufacturing industries is examined through industry estimates of the pass-through elasticities and a cross-section analysis of their determinants. We find that the domestic pass-through elasticity increases with the effect of the exchange rate on domestic costs of production, the export share, the elasticity of substitution between imports and domestic goods, and the domestic advertising intensity. The import elasticity increases with the elasticity of substitution and the rate of price protection and decreases with advertising intensity.

Tax Versus Quota Regulation: A Stochastic Model of the Fishery

In a deterministic setting, it has been demonstrated that taxes and quotas can be equivalent regulatory instruments and that both can in principle induce an optimal allocation of resources in markets where externalities are problematic. In this paper we consider growth, harvest, and demand uncertainty within the context of Canadas Pacific halibut fishery and find that, while taxes remain the preferred instrument, the welfare losses arising from the use of individual boat quotas are minor.

The economic costs of biological predation

This paper developes a bioeconomic model to analyse the economic losses from the reduced harvesting of prey species resulting from an increase in the stock of a natural predator. Examples of large mammals creating economic damage are whales and African elephants. The economic losses depend critically on the actual management of the prey stock, although the three measures we develop are equal when the stock is managed so as to maximize the sustained economic rent from the prey species. Predation losses are illustrated by the case of the Northeastern Atlantic Minke whale, where the estimate of the average predation cost per whale in 1991–1992 is between

Productivity change in Canadian mining 1957–1979

US 1780 and

Determinants of domestic and import prices in Canadian manufacturing industries

US 2370, using Norwegian cost and earnings data. A ten percent stock increase is estimated to cause a loss of almost

R. A stochastic dynamic programming model of bycatch control in fisheries

US 19 million to the fishers of the prey species. If half of this cost were assigned to Norway it would be equivalent to 2.8 and 6.7 percent of the gross profits of the Norwegian cod and herring fisheries, respectively.

Environmental controls in extractive industries

This paper calculates multifactor productivity trends in seven Canadian mining industries and relates changes in productivity to various factors, including changes in output and factor prices and the decline in the quality of the ore being mined. It is found that productivity decline in mining has been pronounced and tended to predate that of manufacturing by several years. There are indications that the most important factors in the decline have been the fall in mineral grade, contraction of output, increases in interest rates and an apparent decline in the rate of technical innovation.