Exhaustibility and the durable-goods monopolist
type: Item
instance of: scholarly article
title: Exhaustibility and the durable-goods monopolist
zbMATH Open document ID: 0653.90011
DOI: 10.1016/0895-7177(88)90031-3
author: J. L. Solow
author: David A. Malueg
published in: Mathematical and Computer Modelling
publication date: 1988-01-01T00:00:00Z
review text: A dynamic profit-maximization model of a monopolist is considered where there are two periods and the monopolist's output is an exhaustible durable good such as gold or diamond. It is shown that the condition of exhaustibility when combined with the profit maximization objective leads the monopolist to a certain degree of precommitment in his production plan. Four different cases are presented to show when it is optimal to produce according to a dynamically consistent feasible production plan, when two periods are involved and the monopolist has to optimize against the residual demand in the second period.
Mathematics Subject Classification ID: 91B76
Mathematics Subject Classification ID: 91B62
Mathematics Subject Classification ID: 91B24
zbMATH DE Number: 4066583
zbMATH Keywords: dynamic profit-maximization model
zbMATH Keywords: monopolist
zbMATH Keywords: exhaustible durable good
zbMATH Keywords: dynamically consistent feasible production plan
MaRDI profile type: Publication
full work available at URL: 0895-7177(88)90031-3
OpenAlex ID: W1986328760
cites work: The Pricing of Durable Exhaustible Resources: Comment
cites work: The Durable Goods Monopolist and Consistency with Increasing Costs
description: scientific article; zbMATH DE number 4066583