Numerical solution of dynamic oligopoly games with capital investment Academic Article

abstract

• This paper discusses how numerical techniques may be used to solve the simultaneous functional equations that arise in general dynamic stochastic games. Unlike the conventional linear-quadratic approach, our methods may be used to address general model specifications that may include nonquadratic objective functions, non-linear equations of motion, and constraints on decision variables. As an illustration, we apply our methods to a dynamic duopoly game in which competing firms play short-run quantity game subject to production cost that can be lowered through investment in capital stock in the long run.

authors

• Vedenov, Dmitry

published proceedings

• Economic Theory

altmetric score

• 3

author list (cited authors)

• Vedenov, D. V., & Miranda, M. J.

citation count

• 30

complete list of authors

• Vedenov, Dmitry V||Miranda, Mario J

publication date

• January 2001

publisher

• Springer Nature  Publisher

published in

• Economic Theory  Journal

keywords

• Basic Behavioral And Social Science
• Behavioral And Social Science

Digital Object Identifier (DOI)

• 10.1007/pl00004133

start page

• 237

end page

• 261

volume

• 18

issue

• 1

URL

• http%3A%2F%2Fdx.doi.org%2F10.1007%2Fpl00004133