Code for: "Relinquishing Riches: Auctions vs Informal Negotiations in Texas Oil and Gas Leasing"
Principal Investigator(s): View help for Principal Investigator(s) Thomas R. Covert, University of Chicago. Booth School of Business; Richard L Sweeney, Boston College
Version: View help for Version V1
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| code | 01/11/2023 05:47:PM | ||
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Project Citation:
Covert, Thomas R. , and Sweeney, Richard L. Code for: “Relinquishing Riches: Auctions vs Informal Negotiations in Texas Oil and Gas Leasing.” Nashville, TN: American Economic Association [publisher], 2023. Ann Arbor, MI: Inter-university Consortium for Political and Social Research [distributor], 2023-02-17. https://doi.org/10.3886/E181143V1
Project Description
Summary:
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This paper compares outcomes from informally negotiated oil and gas leases to those awarded via centralized auction. We focus on Texas, where legislative decisions in the early twentieth century assigned thousands of proximate parcels to different mineral allocation mechanisms. We show that during the fracking boom, which began unexpectedly decades later, auctioned leases generated at least 55 percent larger up- front payments and 40 percent more output than negotiated leases did. These results suggest large potential gains from employing centralized, formal mechanisms in markets that traditionally allocate in an unstructured fashion, including the broader $3 trillion market for privately owned minerals.
These materials provide the code to estimate the results in the paper. The data for this project is published separately, as a Harvard Dataverse replication dataset: https://dataverse.harvard.edu/dataset.xhtml?persistentId=doi:10.7910/DVN/9WJ3JK. The makefile contained within these materials will automatically download the replication data, if the replicator has not already acquired them.
These materials provide the code to estimate the results in the paper. The data for this project is published separately, as a Harvard Dataverse replication dataset: https://dataverse.harvard.edu/dataset.xhtml?persistentId=doi:10.7910/DVN/9WJ3JK. The makefile contained within these materials will automatically download the replication data, if the replicator has not already acquired them.
Scope of Project
Subject Terms:
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Auctions;
decentralized markets;
oil and gas exploration
JEL Classification:
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D44 Auctions
L13 Oligopoly and Other Imperfect Markets
Q35 Hydrocarbon Resources
D44 Auctions
L13 Oligopoly and Other Imperfect Markets
Q35 Hydrocarbon Resources
Geographic Coverage:
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Texas
Time Period(s):
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1/1/2004 – 12/31/2016
Collection Date(s):
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2/1/2017 – 9/2/2021
Universe:
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Mineral leases in land originally belonging to the Texas Permanent School Fund.
Data Type(s):
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administrative records data;
geographic information system (GIS) data;
program source code
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