| This thesis comprises three essays on the management of nonrenewable resources.;Pollution is often associated with the use of nonrenewable resources. Indeed, many of today's most pressing environmental problems are caused by these types of activities. Despite the connection between nonrenewable resource use and environmental degradation, the two issues have been, for the most part, analysed separately by economists. The first paper develops a framework to analyse the effects of a pure-flow externality on the competitive allocation of nonrenewable resources. For commonly-used specifications of consumer preferences, the competitive allocation is found to be fully optimal for pure-flow externalities exhibiting decreasing marginal disutility. Hence, the paper shows that the presence of a negative externality associated with the use or extraction of a nonrenewable resource need not result in inefficiency.;The US 1990 Oil Pollution Act is the most significant attempt yet made by a nation to deal with pollution of its territorial waters. It significantly altered the rights and obligations of tanker owners operating in US waters, effectively introducing unlimited liability and significantly expanding the definition of spill damages. The second paper analyses the effect of the Act on major pelagic oil spills occurring world wide. The hypothesis that the Act had a negligible effect on the number of spills occurring in North America's coastal waters is tested empirically. The results indicate that the Act significantly reduced the number of spills occurring in North American coastal waters and has had no discernible effect on spill frequencies elsewhere.;There is a keen and growing interest in the properties of vertical relationships governing the pricing and transfer of intermediate goods. The third paper examines an unusual and commercially-important vertical relationship---the price participation system---which is used extensively in the zinc industry. The paper explores the conjecture that significant demand uncertainty and risk aversion on the part of zinc smelters might explain why the industry uses the price participation system rather than a more conventional contractual arrangement. The results indicate that these factors do go part way toward explaining why the industry uses the price participation system. |
