This paper generalizes Hotellings (1931) theory of nonrenewable resources to situations where resource pools and their users are distributed spatially. Extraction and transport costs are assumed to be linear in the rate of extraction, but utilization of each deposit may require a setup cost. While Herndahls (1967) analysis of the socially optimal utilization of multi- ple deposits by a single user can be given a spatial reinterpretation, our contribution is to generalize his results further to the case where there are multiple users who are themselves spatially distributed. While our spatial generalization is important in many resource ap- plications, it is essential to an understanding of solid waste problems. Landll space may be regarded as a depletable resource, since space extracted today is unavailable tomorrow. But since cities and landlls are dispersed geographically, transshipment ofwaste commonly occurs within and between countries. Our analysis characterizes socially optimal waste ows over time and space and will facilitate the evaluation of the many government interventions designed to regulate such shipments of solid waste.
