EXHAUSTIBLE RESOURCE THEORY AND THE URANIUM MARKET

摘要

This study applied intertemporal maximization theory for exhaustible resources to the U.S. uranium or yellowcake market. Exhaustible resource theory has been developed rapidly by economists since the OPEC shocks of 1973-1974 and the theory now provides a framework for analyzing the optimal production pattern for resource commodities. However, applications of the theory to particular markets, such as crude oil, have not provided accurate predictions due no doubt to theoretical problems in explaining exploration and discovery events, market organization changes, and uncertainty. More applied work ought to provide important new ideas for the theory as well as to add to the stock of knowledge in this area. This thesis has in this spirit investigated the uranium market in an effort to determine how much might the exhaustible resource theory explain the past price and quantity time paths of this energy resource, and what might be expected in the future.;The exhaustible resource theory was first developed in a form appropriate to an application to the uranium market. In particular, the different price paths that might be expected under competitive, monopoly and oligopoly markets were derived and discussed. The theory was then applied to the data to obtain a set of price paths for past periods that provide evidence on the workings of the market to date.;An econometric simulation model which combines the history of uranium price formation and the exhaustible resource theory was developed to forecast future uranium prices. The model was designed not only to reflect the physical processes of drilling activities, changing reserves, production and prices of uranium through individual equations, but also to account for the interaction of all these interrelationships at the same time. By simulating the entire system as a closed-loop, the model has been checked against the historical data. The overall good agreement of simulation results with actual observations demonstrates that the model is, in its present state, a suitable tool for predicting future uranium prices.;Projection results by directly applying the exhaustible resource theory were also analyzed and compared with the simulation results.;Finally, suggestions for further research are given. Modeling efforts in uranium demand and reserves, as well as analyses of advanced-reactor system and international trade are recommended.