Open AccessPARTIAL VERSUS GENERAL STORAGE POLICY: COMMODITIES AND RESOURCES
Author(s) -
Just Richard E.,
Lichtenberg Erik,
Zilberman David
Publication year - 1994
Publication title -
natural resource modeling
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.28
H-Index - 32
eISSN - 1939-7445
pISSN - 0890-8575
DOI - 10.1111/j.1939-7445.1994.tb00185.x
Subject(s) - commodity , resource (disambiguation) , agency (philosophy) , water storage , natural resource economics , environmental economics , business , irrigation , water resource management , economics , microeconomics , environmental science , finance , computer science , inlet , biology , mechanical engineering , computer network , ecology , philosophy , epistemology , engineering
This paper examines joint storage considerations when both commodities and resources can be stored, e.g., grain and water for irrigation. Results suggest that when separate agencies control public resource and commodity storage, suboptimal storage rules occur unless (i) each agency is sensitive to the policies of the other, (ii) commodity inventories are adjusted in response to prices, and (iii) resource inventories are adjusted in response to both commodity demand and resource supply conditions. For example, the common case where water storage depends on weather and reservoir conditions alone is not sufficiently general. The results imply that water management agencies that tend to be dominated by engineers and hydrological considerations need to incorporate economic considerations into decision processes.