Questions tagged [model]

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Water Economic Metaphor - Evaporation / Condensation

I was considering economics, and how a lot of economics tends to use a water metaphor as a descriptive mechanism. Ex: market liquidity, "investment evaporated", "market flows around ...
G. Putnam's user avatar
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How do I find the best response for a Stackberg duopoly with price leadership, specifically for the question below

Consider a market served by two firms, firm $1$ and firm $2$. Suppose that the (inverse) demands for the two firms are given by $P_1=1-q_1-aq_2$ $P_2=1-q_2-aq_1$ with $a$ belongs to $(0,1)$. In ...
Aarav's user avatar
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1 answer
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PER CAPITA SPENDING - IS THERE A MODEL?

In 1975 the world population reached 4 billion people. In 2023 it reached 8 billion In 1975 the US population was 211 million. Today it is 340 million. Considering that: 1- we now have more people, ...
Denis Pageau-Sociétalogue's user avatar
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optimal delegation model extension

for my seminar paper I need to extend the model of optimal delegation, I have no idea how I can evaluate my ideas (because my professor keeps ignoring me) , can someone say if the idea of the ...
user848273982398's user avatar
2 votes
1 answer
120 views

Frameworks and models in economics

A framework is not a model of a specific system, but a way of formulating and studying a variety of systems. Classical mechanics, quantum mechanics and statistical mechanics are all really frameworks. ...
quanity's user avatar
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Is there a labor vs leisure model with work experience?

I find the labor-leisure model with utility functions interesting, but I find it lacks the factor of work experience, which is very important in the real life labor market. This is a reason people why ...
Nicolas Torres's user avatar
1 vote
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74 views

Monopoly Board Game Situation Modeled With Game Theory

Three players are playing the board game Monopoly. All properties are acquired, and only Player A has completed a color group. This also leaves Player A with very little cash. Player B and Player C ...
user10478's user avatar
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3 votes
1 answer
135 views

Why do we omit the integral when deriving the f.o.c.’s in long-run growth models such as Romer (1990)?

For example when solving Romer’s model (1990) in continuous time, for the firm producing final goods, its production function is: $ Y(t) = \int_{0}^{M(t)} (A(t) L_Y)^{1-\alpha} {x(i,t)}^{\alpha} di$, ...
Nicolas Torres's user avatar
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Infer collective prices based on individual prices

Given a neighborhood with $m$ trash removal companies currently serving $n$ neighbors, each paying $p_m$ for the service, how would an economist calculate an expected price, $p_e$, in the event that ...
user121330's user avatar
0 votes
2 answers
125 views

Revisiting development of Solow Model with no population growth and no technical progress

Consider an economy descried by the production function: 𝑌 = 𝐹(𝐾, 𝐿) = 𝐾0.3𝐿0.7. a) Derive the per-worker production function. b)Assuming no population growth or technological progress, find the ...
Gibson Kashindwa's user avatar
1 vote
1 answer
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Habit forming Model & State Variables

Taking the habit formation model of consumption, as a standard dynamic programming problem. Bellman Value Function for Habit Model Max$\sum_{t=1}^Tβ^tu(c_t - γc_{t-1})$ $\qquad \qquad (1)$ s.t. $w_{t+...
CormJack's user avatar
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3 votes
1 answer
66 views

Simulation of a dynamic search and matching model

I want to simulate a search and matching model very close to the canonical model developed by Pissarides. I am interested in representing the trajectory of the unemployment rate when the unemployment ...
mayo's user avatar
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1 vote
1 answer
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Lagrangian for the utility-mazimization of a household in a Menu Cost model, first order condition to Ci?

I need to solve the partial derivative to C_i of the integral provided below. I'd be more than happy for some help. Based on the book's answer, we get: Can someone explain how do we get there? And ...
Delia's user avatar
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Parameters of ENV-GROWTH model for SSPs' GDP projection?

I'm searching to reproduce the ENV-GROWTH model used for the Shared Socioeconomic Pathways (SSPs). The ENV-GROWTH model is a IAM used by OECD OECD website. It has been detailed in the Long-term ...
Anthony Couthures's user avatar
4 votes
1 answer
188 views

How to use Leibniz Rule of integration to find interest rate in Expanding Variety model

I'm studying growth theory from Barro/Sala-i-Martin and I stumbled upon a problem where some more advanced level of calculus is required in chapter 6 (Models with Expanding Variety: p. 294 eq. 6.18). ...
Dario's user avatar
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2 answers
366 views

Decoding Endogenous vs Exogenous - Parameter vs Decision Variable - and Independent vs Dependent

this is a topic that i feel is very implicit in a lot of economics, but is some times brushed over in interest of getting strait to the model or the maths. But often i realise i don't actually know ...
CormJack's user avatar
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3 votes
2 answers
211 views

How to handle multiple lagrange multipliers in a maximization problem?

Let's assume a standard household maximization problem of the form: \begin{align} \underset{C_t}{max} \sum_{t=0}^{\infty} \beta^t U(C_t) \end{align} subject to a standard Budget constraint: \begin{...
mindandfields's user avatar
1 vote
0 answers
44 views

Help me understand the shock process in this DSGE model

I'm looking at the model proposed in Hansen2020. The not linearized model features a shock equation looking like this: $A_t = \bar{A}*e^{\epsilon_t}$ , where $\bar{A}$ is the steady state of $A_t$ and ...
mindandfields's user avatar
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Industry-specific control variables

I am writing about bank-lending to a specific industry and how that could be affected by the level of carbon intensity of a given industry within the EU. I have some thoughts on this: Trying to think ...
Bella's user avatar
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1 answer
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2 intercepts in a probit model about WTO/GATT concessions?

I am currently reading a research paper(Developing Countries and General Agreement on Tariffs and Trade/World Trade Organization Dispute Settlement by Marc L. BUSCH and Eric REINHARDT) and in the part ...
viktor nikiforov's user avatar
1 vote
1 answer
39 views

How do we know Solow has DRS and Harrod-Domar has CRS from the definitions of the models?

This may be a stupid questions as I am just studying undergrad economics honours but how do we know that the solow model has diminishing returns to its input and harrod-domar has constant returns to ...
viktor nikiforov's user avatar
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1 answer
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Model for how the shifting of industries affect job creation

I am working on my Master's thesis (International Relations) and I want to argue, backed with data, that when an industry gets bigger in terms of production, efficiency, in detriment of another ...
Sebastian Morin's user avatar
1 vote
0 answers
35 views

Help with Macroeconomics Question: IS-LM Model [closed]

I know this is supposed to be a simple question, but I need to check the answers for it and as it was a past exam question I do not have the results for it.If anyone can help out, that would be ...
Antony Mark's user avatar