An Econometric Analysis of MMS Area-Wide Leasing Versus Tract-Nomination Sales: Does Area-Wide Leasing Result in Lower Government Revenue?

Abstract

In 1983, US Minerals Management Service (MMS) switched from the Lease Nomination sale format to Area-Wide Leasing (AWL). Since a complete econometric analysis of the effects of AWL on government revenue has not been conducted in almost twenty years, the purpose of this study was to determine the effects of AWL on government revenue. Results indicated that AWL reduced government revenue by $1,170 to$1,308 on a per acre basis, which is consistent with the findings in prior literature.Area-Wide Leasing (AWL), Outer Continental Shelf (OCS), High Bonus Bids, Environmental Economics and Policy, Resource /Energy Economics and Policy,