Petroleum Reserve Responsiveness in the United States: A Comparison of Alternate Forecasting Methods Book

	Preface
	Acknowledgments
I	Introduction	3
	Blueprint	4
	Historical Factors Influencing Exploration Incentives
	The Epple Model
	An Ad Hoc Supply Model
	Forecasting with the Model
II	Historical Factors Influencing Exploration Incentives	9
	Institutional Framework	9
	Physical Constraints
	The Petroleum Market
	Fiscal Policy
	Rule of Capture
	Prorationing
	Import Controls
	Tax Policy
	Price Control Programs of the 1970s
	The Windfall Profit Tax Act of 1980
	Fiscal Summary
	The Unit Price Formula	21
	The Unit Price Framework
	Variations
	Production Constraints
	Price Constraints
	Taxation
III	The Epple Model	39
	Non-Renewability	39
	Renewable Inputs
	Non-Renewable Inputs
	The Aggregate Oil Bearing Land Supply Function
	The Exploration Model	46
	Profit Maximization
	Reduced Form Equations
	Estimation	50
	Replication of the Original Model
	Extension of the Original Model
	Data Adjustments
	Data Adjustment Results
	Data Extension
IV	An Ad Hoc Supply Model	73
	Definitions	74
	The Model	75
	Exploratory Wells
	New Field Discoveries
	Old Field Discoveries
	Extensions
	Revisions
	Production
	Econometric Estimation of Model	89
	Exploratory Wells
	New Field Discoveries
	Old Field Discoveries
	Extensions
	Revisions
	Production
	Simulation Properties of the Complete Model	99
	In-Sample Forecast Performance
	Ten Year Forecast - 1987 to 1996
	Dynamic Multiplier Properties of the Model
V	A Comparison of Alternate Models	119
	Forecast Assumptions	119
	In-Sample Forecast	122
	Ten Year Forecast - 1987 to 1996	125
VI	Analysis of the Windfall Profit Tax	129
	The Unit Price	130
	Model Simulation - 1981 to 1986	130
	High Price Profile
	Actual Price Profile
VII	Conclusions	141
	The Modified Epple Model	141
	The Ad Hoc Model	143
	Policy Analysis	145
	Appendix: Derivation of Reduced Form Equations	147
	Bibliography	153
	Data Bibliography	157
	Index	159