Commodity Trade in Continuous Time, Long-Term Availability and Storage Capacity

Competitive Storage and Commodity Price in Continuous Time

“…This paper develops a different approach, proposed in the monograph by Vavilov and Trofimov (2021), to the formal analysis of the competitive storage model in continuous time. The motivation of this approach is twofold.…”

“…The solution for a stationary rational expectations equilibrium of the model is derived analytically in this paper, unlike the mentioned above monograph by Vavilov and Trofimov (2021) 1 . This solution is given by an equilibrium price function of the long-term availability defined as the sum of storage and the expected cumulative disturbances of net supply of commodity over the infinite horizon.…”

“…In the early version of this model,Vavilov and Trofimov (2021) did not use the no-trade conditions in the description of commodity traders' behaviour and considered a different case of net demand function. They characterized the model solution, but did not derive an analytical solution for the equilibrium price function and did not conduct numerical simulations.…”