Abstract
When inputs to production of a natural resource are committed both in advance of production and at the time of production, the discounted time series of the prices of that resource no longer have the martingale property of asset prices. Instead, they should be positively correlated to current demand conditions and negatively correlated to the demand conditions that were forecast at the time of the first decision to obtain in the current period.
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References
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© 1999 Springer Science+Business Media Dordrecht
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Berck, P. (1999). Estimation in a Long-run, Short-run Model. In: Abildtrup, J., Helles, F., Holten-Andersen, P., Larsen, J.F., Thorsen, B.J. (eds) Modern Time Series Analysis in Forest Products Markets. Forestry Sciences, vol 58. Springer, Dordrecht. https://doi.org/10.1007/978-94-011-4772-9_8
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DOI: https://doi.org/10.1007/978-94-011-4772-9_8
Publisher Name: Springer, Dordrecht
Print ISBN: 978-94-010-6005-9
Online ISBN: 978-94-011-4772-9
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