Author(s)

Johnson Kakeu

Department of Economics, Morehouse College, Atlanta, Georgia, USA.

This paper uses a general equilibrium assets-markets approach with arbitrageurs for valuing mineral resource deposit ownership. The results are contrasted with those delivered by a partial equilibrium approach. We show that in a general equilibrium assets-markets approach, arbitrageurs’ valuation of resource deposit rights commands a discount factor that adjusts not only for the time depreciation but also for changes in the resource stock size over time. A general equilibrium assets-markets approach with arbitrageurs leads to a more conservative management of exhaustible natural resources than a partial equilibrium approach does.

Conservation Finance, Arbitrageurs, General Equilibrium in Assets Markets, Partial Equilibrium, Mineral Rights Ownership, Capital Markets, Resource Conservation

Kakeu, J. (2018) Valuing Exhaustible Resource Ownership: General Equilibrium Assets-Markets versus Partial Equilibrium. Theoretical Economics Letters, 8, 844-853. doi: 10.4236/tel.2018.85059.