Questions tagged [self-study]
Questions about self-studying economics, including curriculum design, study strategies, resources, etc.
131
questions
0
votes
1answer
82 views
Preference: Convexity and Monotonicity
I need an example of a
Convex, non-monotonic preference
Non-convex, monotonic preference
I figured that an example of non-convex, monotonic utility preference could be $U(x,y)=x^2+y^2$.
For convex, ...
0
votes
0answers
23 views
optimization problem for two individuals
Two flat mates 1 and 2, rent a flat and play their own music on the only CD player owned by flat-owner. They both like their own music, but dislike the music played by the other. Given the timing ...
0
votes
0answers
36 views
two period consumption problem
Ms. A earns 25,000 dollars in period 1 and 15,000 dollars in period 2. Mr. B earns 15,000 dollars in period 1 and 30,000 dollars in period 2. they can borrow money at an interest rate of 200% and can ...
-3
votes
1answer
37 views
NASH equilibrium [closed]
How to approach questions like these:
In a two player static game with a discrete strategic space that permits each player to chose one of the four possible strategies what is the maximum number of ...
2
votes
1answer
29 views
How do you keep up to date and find the most relevant papers?
What tools or methods you use to keep up with the frontier of the field? I follow some specific papers and authors. I was wondering what's the best way to keep up to date with relevant things with so ...
0
votes
1answer
30 views
Neoclassical model with proportional taxes
In a certain economy, time is discrete with periods $t=0,1,2,...$. The economy is populated by many households and identical firms. The utility of a household is:
$\displaystyle\sum^{\infty}_{t=0}\...
0
votes
1answer
50 views
Spence's Job Market Signaling Game
I have a little doubt in the Job Market Signalling Game. I am referring to A Primer in Game Theory: Gibbons, Chapter 4, Signaling Games
The attached paragraph refers to a Separating Equilibrium case ...
2
votes
1answer
62 views
Repeated Game SPNE
I approached this question in this way:
$(P_1,P_2), (R_1,R_2), (S_1,S_2)$ are the Nash Equilibria of the Stage 1 game. For the given strategy to be sustained as SPNE, there should be no way unilateral ...
1
vote
1answer
40 views
SPNE and Pareto Optimality
"The SPNE of a sequential game might not necessarily be Pareto Optimal"
I understand the definitons of Nash Equilibria and Pareto Optimality and that these are not synonymous concepts. An example in ...
4
votes
1answer
50 views
Expected payment in a second price auction with affiliation
The symmetric bidding strategy in a second-price auction with affiliation is given by $\beta(x)=v(x,x)$, where $v(x,y)=E[V_1|X_1=x,Y_1=y]$ (here $Y_1$ is the highest ordered statistic among the ...
1
vote
1answer
35 views
Bayesian Nash Equilibria: Strong and Weak Types
I need a little help with the question. I understand that since both players have two types each, there will be 4 different payoff matrices to be considered, $(S,S)$,$(S,W)$,$(W,S)$,$(W,W)$, each type ...
4
votes
1answer
140 views
Auctions with affiliation
This problem is an example given in Vijay Krishna's Auction Theory (2nd Edition, Chapter-6, Example 6.2). The problem is as follows:
Suppose $S_1,S_2$, and $T $ are uniformly and independently ...
1
vote
0answers
32 views
Take It Or Leave It Strategy: Social Optimum
Here is what I understood
Using Backward Induction, I inferred that buyer offers a price, say, $P$ and the seller will sell only if $P \geq c(I)$. Setting the lowest possible Price that will ensure ...
0
votes
0answers
11 views
Relation between Captial Market Line and Security Market Line
I am referring to the book, "William Sharpe et al, Investments, 6th Edition. I am trying to wrap my head around some lines from the book, pertaining to Security Market Line.
It reads,
"Earlier it ...
1
vote
1answer
23 views
Is there book or research on economically sustainable design of town or village?
I'm looking for a book which may help to design a self-sustainable small settlement, which can maintain its own economy with limited connections to the outside world. Prefereably it should answer ...
3
votes
3answers
153 views
Book recommendations: Introduction to economics
I recently made my first trip to a foreign country. I'm quite amazed by how things work. Why are things priced differently at different places? Is the bed-sheet that I bought from that country worth ...
3
votes
1answer
94 views
Disagreement in Strategic Bargaining
Construct a pair of startegies for the ultimatum game ($T=1$ bargaining game), that constitutes a Nash Equilibrium and together support the outcome that there is no agreement reached by the two ...
2
votes
2answers
59 views
Matchstick Game
Consider the following $2$ player finite extensive game. Player $1$ moves first. She must choose an integer from $1$ to $10$, and place that number of matchsticks on the table. Next, Player $2$ must ...
0
votes
0answers
33 views
Strategy sets and SPNE
I need to find the startegy sets for the two players in this game. I understand that the game has only one subgame, that is, the entire game.
I cannot seem to understand the strategy sets of the ...
1
vote
1answer
59 views
features of Generalised Method of Moments estimation
[
What does it mean that GMM is robust to distributional assumptions?
0
votes
0answers
21 views
Linearisation of the IS curve?
How to the IS curve linearised around the structural equilibrium?, what is the math behind it?
1
vote
1answer
37 views
Nash Equilibria in Target Destroying-Guarding Game
Army A has a single plane which can strike one of three possible targets, A, B and C. Army B has one anti-aircraft gun that can be assigned to one of the three targets to guard it. The value of each ...
2
votes
2answers
123 views
Best Response Functions for Cournot
For a Cournot Duopoly game with Linear Demand functions, we need to find the optimal quantity of each firm such that profit is maximised. Given the linearity of the Demand curves, we will obtain a ...
0
votes
1answer
76 views
General Equilibrium Involving Production
I need a little conceptual clarification.
For a standard $N*K*M$ general equilibrium model, would an allocation, say, $y^k$ be Pareto Optimal if it does not solve $max(py^k)$?
I understand that the ...
1
vote
1answer
66 views
Majority Rule and Single Peakedness
Majority Rule will induce non empty choice set if individual preferences are single peaked
Is this statement true? I have some trouble in understanding the meaning of 'single peakedness' in context ...
3
votes
1answer
109 views
Blocking Coalitions
For $n$ individuals, can a blocking coalition only be formed by at least $n/2$ individuals? For example, if there are 6 individuals, can less than 3 individuals form blocking coalitions?
0
votes
2answers
48 views
Yield To Maturity exact meaning
From investopedia: "YTM is the total return anticipated on a bond if the bond is held until it matures"
I have also seen this interpretation used in other sources however this seems wrong to me.
...
2
votes
1answer
73 views
Is it right to derive social marginal benefit by adding individual prices instead of quantities?
I come across a lecture material on market functions and externalities that makes me quite confused. Here's the setup: Two stores are located next to each other. If one installs a camera system in ...
0
votes
1answer
152 views
Prove that $u$ is a utility function for $\succsim$
If X is finite, define this function $u : X \rightarrow \mathbb{R}$ by $u(x) = |\{z\in X:z \prec x \}|$. Prove that $u$ is a utility function for $\succsim$.
Is it sufficient to prove that the ...
0
votes
2answers
80 views
Doubt about equivalence relation
In class I was taking notes about equivalence relations defined as:
Given a generic relation $R$ on $X$, $xIy$ if both $xRy$ and $yRx$
Now, I don't really understand the following proposition:
...
2
votes
1answer
50 views
If $\succsim$ is transitive but irreflexive, then it is asymmetric, proof
If $\succsim$ is transitive but irreflexive, then it is asymmetric.
this is my proof:
Suppose $\succsim$ is not asymmetric, which means that for any $x,y \in X$ $x\succsim y \rightarrow y \succsim ...
3
votes
1answer
222 views
separable utility function and cross price effect
Suppose that consumer's utility function for three goods is separable, that is,
$U(x_1, x_2, x_3) = f_1(x_1) + f_2(x_2) + f_3(x_3)$ ...(i)
where $f_i$ is increasing and strictly concave, i=1,2,3. ...
2
votes
1answer
40 views
Prove that in presence of many goods, the law of DMRS implies that at least one good must be a net substitute for any other good
I've been reading a book where the author claims that "if there are two goods they are always net substitutes. Along an indifference curve an increase in price of good 2 leads to less of good 2 and ...
1
vote
1answer
72 views
Income gap in Ramsey model
Ramsey model with income tax
Question:
For this question you are required to setup a Ransey-Cass-Koopmans model economy with a Cobb-Douglas constant returns to scale production technology, with ...
0
votes
2answers
48 views
when a=0, would economy accumulate more physical capital? Why?
Utility function is
$U(c_t,l_t)=(1-a)ln(c_t)+aln(l_t)$
$l_t$ is leasure time
$c_t$ is consumption
Production function is $y_t=k_t^e(1-l_t)^{1-e}$
$k_{t+1}=i_t+(1-\delta )k_t$
where k is ...
1
vote
0answers
90 views
Signaling questions (separating equilibrium)
Consider two firms
Inverse functions: $p(q)=max\{a-q,0\} $
$q$ is total production and a is positive constant.
This value of a takes two values ah=2 (high demand) and aL=1 (low demand). Their ...
1
vote
0answers
60 views
Maximization under two different states of the world [closed]
What I did is the following one but I am not sure at all:
Any help will be appreciated. Thank you.
-1
votes
1answer
268 views
Profit maximization and allocative efficiency result
I completely stuck to the last part of this exercise. I cannot understand how can I determine an allocative efficiency result.
Any help will be appreciated. Thank you.
2
votes
1answer
212 views
Stackelberg setup
I am completely confused because I cannot find the leader's best response. I do not know if it is exactly the same as it was a Cournot game. What I did is:
Any help will be appreciated a lot. Thank ...
4
votes
1answer
389 views
Bertrand game - Nash equilibrium
The quantity is limited to 300 but the monopoly quantity is equal to 400 and gives a monopoly price of 600. But if we plug the quantity of 300 into the demand function we get a price of 700.But I am ...
2
votes
1answer
144 views
Subgame perfect equilibrium and expected profit
I am so confused because I cannot set up the monopolist's profit maximization problem.What I did is the following one:
Any help will be appreciated. Thank you.
1
vote
1answer
418 views
Pure exchange economy with free and non-free disposal
Question is as follows:
My answers are
(I)
Let k is constant utility level
Then
$$k=\sqrt{x_A^1x_A^2}$$
$$k^2/x_A^1=x_A^2$$
The first derivative is negative. So the indifference curve is ...
0
votes
2answers
545 views
Question on profit maximization with government taxation
(I) A monopolist has a cost function $c(q)=q$. It faces the following demand function $ q(p)=100/p$ for $p\le 20$ and $q(p)=0$ for $p\ge 20$. What are the profit maximizing price and output.
(ii) a ...
0
votes
1answer
321 views
Question on consumption theory
Question:
What my did is
I proceed this question until that point. But, I will be happy if help me to solve this question.
Thank you.
-1
votes
1answer
269 views
Finding the optimal tax
I have a problem regarding the last two questions of this exercises because I can not understand how to set up my model in order to find the optimal tax the optimal quantity to be as there was not a ...
0
votes
2answers
150 views
a question on the endogenous growth model
I have such a question on the endogenous growth mode”:
In the macroeconomics literature there are various ways in which the growth process in the Ransey-Cass- Koopmans model has been endogenized. ...
3
votes
2answers
360 views
Subgame Perfect Nash equilibrium: two stage game
Charitable organizations are ranked according to the proportion of their total budget that is spend on programs(what directly goes to the recipients of their services) relative to money spent on ...
4
votes
1answer
2k views
Cournot Competition game with 3 Firms
Three firms are in Cournot competition. The inverse demand curve is denoted p(q) where p is the price if a total of q units are produced. Assumptions are: p(0)>0 and p'(q)<0 and p''(q) $\le 0$ ...
0
votes
1answer
62 views
Capital accumulation
I have following dynamic optimization problem
$$V(k_0)=\max \sum_{t=0}^{\infty} b^t((1-a)ln c_t+a ln(l_t))$$
Subject to $l_t+e_t=h$ and $y=Ak_t^pe_t^{1-p}$ and $k_{t+1}=i_t+(1-x)k_t$
...
1
vote
1answer
159 views
Maximization with disposable income
Consider a welfare system u dear which a single cash transfer(guaranteed income ) is given to every citizen. Then for each dollar the person earns the payment is reduced to by a where 00 you get a ...
