ON EFFICIENCY-INDUCING TAXATION FOR A NONRENEWABLE RESOURCE MONOPOLIST

The problem of using taxes to induce a monopolist supplier of a non-renewable resource to extract efficiently has been solved under the assumption that the government has perfect information about the monopolist's cost function and reserves and is able to precommit to an entire sequence of taxes over time. We extend this literature by constructing an efficiency-inducing tax mechanism that does not require the government to have any information about the cost function or reserves and which does not require it to precommit to a sequence of taxes over time.