Abstract
This articles examines the efficiency of the competitive bidding system as a rent collection mechanism, using recent Canadian experience. Bonus bids for petroleum leases in the West Pembina area of Alberta are compared with ex ante economic rents. The ration of a bid to anticipated rent is treated as an indicator of the degree of competition in lease bidding. The estimated ratio suggest competition is sufficiently strong at the lease bidding stage to allow efficient collection of ex ante rents by the Alberta government, at least as an exploration play matures. But auxiliary mechanisms are needed to pick up a suitable share of ex post rents, since current royalty systems are inadequate for this purpose.
Sign-in/Register to access full text options 
Free) 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a call
