Abstract:

This paper deals with revealing the many factors that affect production and price trend in mining industry, the most important being fluctuations in profit rates, fluctuations in extraction cost and  taxes introduced by the Government. Some, such as taxation and the profit, can be treated as variable pricing policy by the government to influence the extraction of non-renewable mineral resources. As often it had been discussed that market imperfections are "best friends of conservatism", the second part of this paper emphasizes that monopoly can exist in mining industry as in manufacturing industry, affecting depletion rates and thus the cost/price of fossil fuels and mining products..