Questions tagged [self-study]

Questions about self-studying economics, including curriculum design, study strategies, resources, etc.

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Writing down Bellman equation

Assume an infinite horizon representative agent economy with the following consumer preferences $u(c_t)$ The production technology of this economy uses capital and land, which is fixed amount in ...
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Real or monetary values? In the context of Classic model

I am studying the classing model. And I have a basic question what are the units of the following variables( monetary or real?) Inflation rate ($\pi$), wage (w), Labor supply N, consumption C, ...
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Endogenous growth model with externalities

I have a following model of endogenous growth where each firm has the following technology; $$y_t=AK_t^{1-\alpha} k_t^{\alpha} n_t^{1-\alpha}$$ The production function above defines an externality. I ...
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Question on Ramsey model with shock on technological level

I have a question on Ramsey Model. Consider the following one-sector, closed, representative household economy. I have the following Cobb Douglas production function in intensive form $$f(k)=Ak(t)^{\...
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Question on the Uzawa-Lucas model

I am studying Solow growth model, I saw such a question. “ In the Uzawa-Lucas model set-up, how the growth rate of consumption changes following a natural disaster, which only destroys physical ...
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Austrian School Regret Theory

I am having a time thinking about how Ruthbard and Mises speak about trade agreements and the concept that every economic transaction is just because it is voluntary and subjectively benefits both ...
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18 views

What are the market frictions?

What are the market frictions which affects the market illiquidity? I would like to learn about friction which impacts the illiquidity measures and the illiquidity discount. For instance, I know those ...
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capital gain tax and lump-sum transfer payment Under the perfect market benchmark

Under the perfect market benchmark where I assume that there is no trade and agents are identical, Can there be capital gain tax and lump-sum transfer payment? or, there is no capital gain tax and ...
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writing budget constraint with capital gain tax

I have the following budget constraint Consumption in period 2 = Wealth in period 2 = Wealth in period 1 + Capital gain from risky assets + The endowment where Gain of risky assets = # of holding ...
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Learning Resource Question - Computable General Equilibrium Modelling

Several years after graduation, I would like to learn some practical computable general equilibrium (CGE) modelling such as a CGE that can handle distributional outcomes. Does anyone know of open-...
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19 views

Transform the constraints for both liquidity demanders and suppliers if I include any tax on risky asset?

I have a question related to Vayanos and Wang's article I'm studying on this article for my course term project. I would like to some adjustment and changes on this article in order to improve it ...
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1 vote
1 answer
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calculating a marginal effect for logit model

For the logit estimate of the slope parameter,I would like to obtain the marginal effect of the regressor ndisease evaluated at $\Lambda (x'\beta)=\bar{y}$, where $\bar{y}$ is mean of $y$. I obtain ...
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Finding Labour Supply in Cobb Douglas type Utility Function

Once again self-study question: Given a household's utility function be: $$U = C^\alpha (1-L)^\beta$$ where, $L$ is labor supplied. Total labor time is normalized to $1$. $C$ is read household ...
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Solow Model With Land as Factor

Given the production function: $$Y = K^\alpha (AL)^\beta R^{1-\alpha -\beta}$$. Where $L, A$ grow at exogenously given rates $n, g$ respectively. $R$ is land and is constant in supply and given that $\...
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5 votes
1 answer
127 views

Solow Model with DRS and Human Capital

This is a self study question. I am novice at this and have only basic knowledge of solving such problems. \begin{align} Y &= AK^\alpha H^\beta \\ \dot{K} &= s_KY - \delta K \\ \dot{H} &= ...
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2 answers
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Which econometric model should I use?

I have the following model Expenditures = a + $b_1$ Output + $b_2$ Labor + $b_3$ CapitalStock + $b_4$ D where D is dummy variable that is Categorical. If tax is imposed, it takes 1. Or if tax is not ...
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Testing method for the performance of R&D support program

Suppose that Government aims to initiate R&D support program to firms The objective of the support program is to rise R&D expenditures and productivity. I have the following data variables: Q: ...
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isoquant of a leontief production function

Consider a firm that can produce q units of good G using two technologies and two production factors, $z_1$ and $z_2$. There are two ways how a firm can produce the good G: It can use 2 units of $z_1$ ...
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1 answer
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A matter of completeness and preference relations [closed]

I have a question about preference relations and completeness. Prove that: i) There exists a complete relation $\succcurlyeq$, such that $\sim$ is not complete. ii) There exists a complete relation $\...
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24 views

Forward Guidance affects interest rate?

Forward guidance affects the effective federal funds rate, right? as opposed to the overnight reverse repurchase/overnight loans, longer-term interest rates, or discount rate of loans from the Fed to ...
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1 vote
0 answers
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Definition of the space of a repeated game

I want to define the space of a stochastic game and it confuses me a lot, so I want someone to check please the space $\Theta$ that I define at the end and how could I define the sigma algebra of this ...
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4 votes
1 answer
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Cheap talk with mechanics

Sorry in advance for asking too many questions. I am just seeking for some minor help and check if what I'm thinking is acceptable. A customer R takes his car to the mechanic S. The mechanic can ...
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Job Market Signaling

My Solution is this Separating equilibrium High type worker chooses $e_H = e^* >0$ Low type worker chooses $e_L =0$ Firms believes that if education is $e^* >0$ then the worker is high type and ...
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1 vote
1 answer
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Finding consistent but inefficient GMM estimate

Consider the following linear model $$y_t = x_t' \beta +u_t$$ where $t =1,...,T$ and $x_t = (x_{1t} x_{2t} ... x_{kt})'$ , $ \beta$ is $k \times 1$ vector of unknown coefficients, $u_t$ is an iid ...
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2 votes
2 answers
138 views

Learning Economics in Three Dimensions

I am trying to teach myself microeconomics via video series. I have a fairly good mathematics foundation, currently studying Partial Differential Equations and having gone through all the prereqs you ...
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3 votes
1 answer
53 views

BNE: Incomplete Information Cournot

Consider two risk-neutral firms that compete in quantities (Cournot). The aggregate inverse demand is given by $P(Q) = 3-Q$. Each firm can only observe its own cost. Find a symmetric BNE. The constant ...
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1 vote
2 answers
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Rule for Number of Strategies in Bayesian Games

Is there a general rule for finding the number of strategies (denote as $S$) for each player in a Bayesian game? I think it's related to the number of types (denote as $T$) and the number of actions (...
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Cournot nash equilibrium

The market demand for a good is described by the inverse demand function $P(Q) = 120 - Q $ where $Q$ is total quantity demanded and $P(Q)$ the market price. Two firms $i =1,2$ have identical cost ...
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1 vote
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Better Model for Dynamic pricing - Stackelberg model or Bertrand model

Objective - I am building a dynamic pricing tool for airline tickets which will consider the competitor prices. Taking competitor price as reference, this tool will price the ticket. Also instead of ...
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1 vote
0 answers
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Fluctuations in income

Consider the following income fluctuation problem. An agent lives for two periods, 0 and 1, and faces stochastic income in period 1. We are given this utility maximization problem: $$\text{max}\ U(c_0)...
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How to derive consumer expenditures in EMEA 14.2.5

I am working on a problem 14.2.5 from EMEA by Sydsaeter, Hammond and Strom. Consider the consumer demand problem: $$ \max_{x,y} U(x,y) = \alpha \ln(x-a) + \beta \ln(y-b) \text{ s.t. } px+qy=m \tag{*} ...
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Coming up with a self self teaching curriculum in economics?

I'm a college grad- engineer by trade and wanted to learn about economics. Since I don't know much about the subject I'm not sure exactly how to progress with learning the field. I've started with ...
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-1 votes
1 answer
82 views

Find the set of Pareto efficient payoffs in game theory [closed]

Here I want to find Pareto efficient payoff set. The answer is (C,β), (B, β), (C, δ) But I don’t understand why? Please explain clearly this answer. Thanks a lot
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1 vote
2 answers
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Best book to self-study microeconomics

What textbook(s) (and other resources) would you recommend to someone who wants to self-study microeconomics to an advanced (graduate) level starting from 0 (i.e. no formal background in economics)? I ...
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2 votes
1 answer
235 views

consumer surplus decreasing

MRU has the following question on a quiz: Suppose the government forced all bread manufacturers to sell their products at a “fair price” that was half the current, free-market price. To keep it ...
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4 votes
1 answer
111 views

Stochastic AK model derivation

Consider the following version of the stochastic Ak model written as a Bellman equation: $$v(A,k)=max\ log(c)+\beta E[v(A',k')|A]$$ $$s.t\ k'+c\leq Ak$$ and non-negatitvities. $A$ is a stationary ...
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2 votes
0 answers
33 views

Stochastic AK model with uncertainty [duplicate]

Consider the following version of the Ak model:$$V^*(A_0,K_0)=max\sum\beta^t\sum P(A^t)\frac{c_t(A^t)^{1-\sigma}}{1-\sigma}$$ st$$ k_{t+1}(A^t)+c_t(A^t)\leq Ak_t(A^{t+1})$$ and non-negativities $A_t$ ...
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1 vote
0 answers
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maximization program with a discount factor in monopoly with learning by doing

I would know something about the multiproduct monopoly. In the case with independent demands and costs dependents, it is in the case with only 1 physical good sold out of 2 periods. For example (...
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0 votes
1 answer
238 views

Why marginal benefit is decreasing as more and more pizzas are being produced?

I'm taking one of my initial courses in Economics on my own and currently reading Economics by McConnel, Brue and Flynn. On the page 13, the book is trying to explain about Optimal Allocation. They ...
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0 votes
1 answer
53 views

What is the producer surplus given the price the consumer paid + price they are willing to pay, and the marginal cost of producing the product?

Linda is willing to pay $6 for a cereal box. Linda bought a cereal box for $4. The marginal cost of producing that cereal box ...
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1 vote
1 answer
305 views

Why there is no supply on monopoly markets?

We learned in the class that monopoly markets do not have supply curve. Our textbook (Microeconomics and Behavior, page 388 from, R. Frank) says: A monopolist has no supply curve and it explains it ...
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1 vote
0 answers
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Will the outcome of a game always be a Nash Equilibrium?

Consider this game between two players. This game has two Nash Equilibria: (U, C) and (D, R). Suppose we ask the players to play this game once. What should our prediction of the game's result be? If ...
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0 votes
1 answer
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Is there a book or notes that explain all about inflation? [closed]

Is there a book or notes or papers (but for easy understanding please) that explain all about inflation? Not at a research level but student level. From what is previously needed to define and ...
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-1 votes
1 answer
41 views

Demand and Supply Curve Shifts

I Study economics independently at Marginal Revolution University. But I am stuck with few of the very first Concepts. Those are: Demand and Supply curve Shifts in Isolation. Demand Curve Shifts: When ...
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0 votes
1 answer
49 views

Assumptions on preference relation

This question is from Harvard seminar problem set (Q-3 part b) https://www.studocu.com/en-us/document/harvard-university/economics/mandatory-assignments/econ2020a-14-ps01-please-give-as-much-...
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1 vote
1 answer
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Find Pareto optimal allocations and the core for the following economies

Find Pareto optimal allocations and the core for the following economies. There are two consumers and two goods. Utility functions are $u_1(x_1,y_1)= 10x_1-(y_1-2)^2$ and $u_2(x_2,y_2) = 10y_2 − (x_2 −...
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4 votes
1 answer
137 views

Finitely repeated Prisoner’s Dilemma with switching cost

I'm doing this finitely repeated Prisoner's dilemma with switching costs but I have trouble showing the fact that $\varepsilon$ had to be $1 < \varepsilon < 2$. I do see why and that it is a ...
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0 votes
1 answer
68 views

Question on overlapping generations

My question is from over lapping generations Question is as follows I found that $$k(t+1)= \frac{\beta(1-\alpha)}{(1+\beta)(1+n)}A(t)k(t)^{\alpha}$$ How can I deal with A(t) to find the steady state $...
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0 votes
1 answer
107 views

Exchange economy find core

Find Pareto optimal allocations and the core for the following economies Consider an exchange economy with two agents and two goods. Let consumption sets are the nonnegative orthant. Agent 1’s utility ...
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0 votes
1 answer
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Transitional Dynamics of consumption per capita in solow model

I can write the transitional dynamics of output per capita as follows $$y=f(k)$$ Take its derivative with respect to time t $$ \dot{y} =f’(k) \dot{k}$$ Divide it by $k/k$ $$ \dot{y} =f’(k) \frac{\dot{...
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