Conference Agenda

This paper designs optimal nonrenewable resource licensing contract under both hidden action and hidden information, when the resource deposit must be explored before it can be extracted. The owner of the resource rights aims to obtain maximal resource revenues, but is unable to observe the exploration effort and the production cost of the firm. We show that under these two information asymmetries, the optimal licensing contract involves two license fees: one is collected before and the other after exploration and discovery. The optimal contract collects the same amount of revenue and includes the same distortions to the firm's decisions to explore and to build capacity as the contract with observable exploration. When the model is interpreted as resource taxation problem, we show that resource rent taxes are not neutral under unobservable exploration and cost, and that the only neutral tax is the one that collects revenue in a lump-sum manner before exploration. At best, this neutral tax collects less revenue than the optimal design.

We introduce a novel climate coalition formation game in continuous time. The model makes the negotiation process during which countries join the coalition explicit. This yields a more realistic description of actual negotiations. In our model, countries are free to decide whether and when to join the coalition. Compared to other models, this leads to a fundamental change in countries' trade-offs and allows for the formation of large coalitions, including the grand coalition, in equilibrium. Relaxing the usual assumption of simultaneous participation decisions, our model thus offers a new resolution to the ``Paradox of International Agreements'' (Kolstad and Toman 2005). Using mixed strategies, our model can also explain delays in climate negotiations, as well as their possible failure on the equilibrium path.

We design optimal mechanism to collect revenues from nonrenewable resource

exploitation, when the resource must be explored and discovered and when there is

asymmetric information. The exploration effort may result in a discovery that is

revealed only to the firm, and the effort is not observed by the owner. We first show

that often applied royalties and rent taxes distort exploration and extraction. Second,

compared to the case without any pricing of the resource exploitation, the optimal

mechanism requires richer discoveries to yield a reserve, induces less exploration, and

results in lower production capacity and extraction.

This paper presents an evolutionary game-theoretic model to explore the transition of human economies between non-symbiotic and symbiotic regimes, driven by the level of renewable natural resource availability. Drawing analogies to biological ecosystems, we formalize a threshold-driven function that triggers regime shifts when resource stocks dip below a critical limit. Through replicator dynamics grounded in the Price equation, our results show that, in a non-symbiotic regime, populations move from competitive to predatory behaviors, overshooting the planet's regenerative capacity. Conversely, a symbiotic regime promotes cooperation and resource-sharing, thus reducing the risk of ecological collapse. Simulations indicate that a predator-dominated world would necessitate approximately 2.30 Earths to sustain its consumption patterns. In contrast, a mutually cooperative world could be sustained with 0.99 Earths, provided that there is a full density of mutualists, a reduction in resource depletion intensity, and an increased sensitivity to resource scarcity. The findings highlight how strategic choices shape ecological footprints, offering pathways for policy interventions to encourage collective solutions and minimize exploitation pressures.