Routledge, Bryan R.; Casassus, Jaime; Collin-Dufresne, … - National Bureau of Economic Research (NBER) - 2005
We model equilibrium spot and futures oil prices in a general equilibrium production economy. In our model production of the consumption good requires two inputs: the consumption good and a commodity, e.g., Oil. Oil is produced by wells whose flow rate is costly to adjust. Investment in new Oil...