Questions tagged [self-study]
Questions about self-studying economics, including curriculum design, study strategies, resources, etc.
220
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3
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Prove the sample variance is an unbiased estimator
I have to prove that the sample variance is an unbiased estimator. What is is asked exactly is to show that following estimator of the sample variance is unbiased:
$s^2=\frac{1}{n-1}\sum\limits_{i=1}^...
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10
votes
3
answers
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How to show that a homothetic utility function has demand functions which are linear in income
A homothetic utility function is one which is a monotonic transformation of a homogeneous utility function.
I am asked to show that if a utility function is homothetic then the associated demand ...
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10
votes
1
answer
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Homogenous of degree one in utility function.
Question
My solution is as follows. Please check my solution. If I make a mistake, please tell. I am really not sure about my solution. Thank you
U(x) is homogenous of degree one i.e. u(...
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7
votes
3
answers
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How can I draw an edgeworth box with 3 different goods?
If there are 3 types of goods(x,y,z) and 2 consumers (a,b) how can I draw the Edgeworth box? It must be 3 dimensional, right?
Is there a software or online tool that I can use to draw a 3D Edgeworth ...
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6
votes
3
answers
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Overview book about economic theories
I'm looking for a good book that gives an (introductory) overview about the existing economic theories and the different schools of thought (optimally with focus to those that affect governments and ...
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6
votes
1
answer
211
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How do I begin to approach this dynamic discrete choice model?
I'm working through an old problem set (that sadly I don't have solutions for) and I got stuck. It is a dynamic model of entrepreneurship and invention. I'm looking for guidance on this model as well ...
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5
votes
1
answer
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Properties on conditional demand correspondence from the textbook of Mas-Colell et al
I have a question on the properties of conditional demand correspondence
Let $z(w,q)$ be the conditional factor demand correspondence, i.e. the solution of the cost minimization problem
\begin{align}
\...
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5
votes
1
answer
120
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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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votes
4
answers
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Books for microeconomics and macroeconomics for selected topics
I am a mathematics undergraduate trying to self-learn some economics. I have no background in economics. I wish to know from which chapters of Hal Varian's "Intermediate Microeconomics" (7th edition) ...
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4
votes
3
answers
810
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Books friendly to self-studying Industrial Organization
I'm currently an undergraduate freshman looking for resources to self-read Industrial Organization. I've read Varian's undergraduate book cover-to-cover and have a decent understanding of basic game ...
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4
votes
3
answers
602
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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 ...
- 141
4
votes
1
answer
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Self-teaching 1st year PhD Microeconomic Theory
How should one proceed if he wanted to master the microecon theory course typically taught in the 1st year of a PhD program on his own? Which text(s) and/or online course(s) should he follow? Suppose ...
4
votes
1
answer
134
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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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4
votes
2
answers
351
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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 ...
- 143
4
votes
1
answer
109
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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 ...
- 1,040
4
votes
1
answer
117
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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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4
votes
1
answer
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Determining subgame perfect Nash equilibriums
Question
Three houses share exclusive access to a beach, but it is dirty due to trash washed ashore. A beach clean-up exercise costs $100$, but has a value of $200$ to each household. A clean-up ...
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4
votes
1
answer
234
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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 ...
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4
votes
1
answer
776
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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 ...
4
votes
1
answer
5k
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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) $\le 0$ ...
4
votes
1
answer
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Deriving long-run cost function
I'm a bit unsure about how to derive a long-run cost function. Suppose my production function was $X(L, K)=L^a K^b$, where $a+b>1$.
I'm thinking about doing the following, but I'm not sure it's ...
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4
votes
1
answer
607
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Optimization problem with Kuhn-Tucker conditions
Consider a game with two players where each player $i=1,2$ has preferences $u_i=s_i^a c_i^{1−a}$, where $c_i$ is consumption and $s_i$ is social interaction. $s_i$ is given by $s_i=t_i+t_{ij}\times t_{...
4
votes
2
answers
44
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What are some database like websites about lower levels of economics (micro/macro) for a research project?
I'm looking for some websites; books or videos on the beginning levels of economics like micro and macro economics to do a research project projects on. I found some course videos but they were a bit ...
4
votes
1
answer
114
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How do I construct the score process of a Markov model and verify that it is a Martingale?
The following is a specific question that is useful for demonstrating a general idea.
Consider the following autoregressive model:
$$
X_{t+1} = \alpha_0 + \beta_0 (X_t - \alpha_0) + W_{t+1},
$$
where ...
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4
votes
1
answer
8k
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How to find corner Pareto efficient allocations
I have some troubles in understanding how to find Pareto efficient allocation that are on the frontier of the Edgeworth box. I mean, the interior ones, can be found using the equality $MRS_A = MRS_B$, ...
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4
votes
2
answers
164
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Financialization of the economy
What is the financialization process of wealth in the economy? What
are the determining factors? What are its consequences?
What is the role of financialization in the economic crisis of 2008?
...
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4
votes
1
answer
2k
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Real world application of IS-LM model
I learnt IS-LM model but I got curious whether it is applicable to the real world. I mean it's just an model, so I doubt that the realtionship between Y and r actually exists. Are there any real life ...
- 133
3
votes
2
answers
297
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a risk lover agent preferences and the preference of risk natural agent may be the same
Consider two lotteries $N$ and $M$. Agent $i$ is risk-averse and prefers $N$. Agent $j$ is risk-neutral and prefers $M$. Would any risk-loving agent $k$ also prefer $M$? That is, would $j$ and $k$ ...
- 153
3
votes
2
answers
649
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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 ...
3
votes
3
answers
3k
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Moral hazard vs hidden information.
What is the difference between hidden information and moral hazard?
I cannot understand these two terms mainly. Please explain. Thank you.
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3
votes
3
answers
509
views
Question on real exchange rate
If the Phillipine peso falls in value against the USD by 5% in a year, but the domestic inflation rate in the Phillipines is 10%, compared to 2% in the USA, the nominal exchange rate has fallen (by 5%)...
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3
votes
4
answers
113
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Why should $dp_2=dm =0$ in this problem?
I am studying Essential Mathematics for Economic Analysis and in chapter 12 problem 10 there is a problem that I can solve but I do not understand why the solution works.
The problem asks us to ...
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3
votes
2
answers
2k
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Marginal Utility with Supply and Demand Curves
Can someone explain how the equilibrium points in the image below (source: The Foundations of Econometric Analysis) represent marginal utilities. I have read about the relationship between the ...
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3
votes
1
answer
612
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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. ...
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3
votes
2
answers
344
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What are the prerequisites to study Mathematical Economics?
I am a high school student with keen interest in mathematics and economics. I wish to study mathematical economics, but most of the books I have encountered begin with quite advanced mathematics. In ...
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3
votes
2
answers
591
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Understanding subscripts in first order conditions of dynamic optimization problems
Suppose we have a simple maximization problem as described in Equation 1.1 here or here. This leads us to the Lagrangian Equation 1.3: $$\begin{align*}\mathcal{L} &= \sum_{t=1}^\infty \beta^{t-1}\...
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3
votes
1
answer
231
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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 ...
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3
votes
1
answer
88
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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 ...
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3
votes
1
answer
139
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Questions regarding foreign exchange online trading
I am currently studying economics in college and taking course Macroeconomics and International Finance which covers foreign exchange market topic. The class is very crowded since there are more than ...
3
votes
1
answer
104
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How to find the long-run relationship using this regression (3rd time posted)
This is an old exam question I can't figure out.
I thought to find the relationship you would sum the coefficients on the Ys, so it would be
0.80 + 0.70 - 0.10, giving you C = 1.4Y, but this isn't ...
roncook
3
votes
1
answer
299
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?
- 401
3
votes
1
answer
85
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The relationship between gross profit and tax
I tried to do following question but I am not sure about my solution. Please tell me your opinions
Since gross profit is strictly concave, I can say that $R’’(y)-C’’(y) <0$
Now I maximize the net ...
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3
votes
1
answer
86
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Profit maximization under uncertainity
I have a seller say S and I have a buyer say B. Buyer’s willing to pay is equal to x which is private information. But Seller believe that it falls in the range [0,x1]. Seller’s belief distribution is ...
user15967
3
votes
2
answers
64
views
How to enhance one's comprehension of the descriptive meaning of formal economic statements?
I found that, though most of the time the math technical parts of economics is not a problem for me, I am somehow troubled with extracting the descriptive meaning of formally stated economic ...
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3
votes
1
answer
37
views
Type of good that can be owned but not consumed when used
I'm an econ noob so apologizes if this is a dumb question.
I'm trying to find if there is categorization of a good that can be owned but is not consumed when used. Tools are an example of this. A ...
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3
votes
2
answers
209
views
Does economic growth always implies investments in infrastructure?
For my course I'm analysing the problem of empty retail stores. I need to analyse how my alternatives to solve the problem would change the important factors about the problem in uncertain scenarios.
...
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3
votes
1
answer
50
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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3
votes
1
answer
49
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Interpreting wedge between MP and wage
I am an econ master student and I need a bit of help understanding an issue, for my thesis. I have two related questions.
Assume a firm producing a good with labor and capital, $Y=F(L,\bar K)$. ...
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3
votes
1
answer
59
views
When first differences contradict a regular regression regarding Investment vs Output relationship
Im doing some research with some panel data I have on firm output and investment.
I ran two equations.
$$y=\beta_0+\beta_1x+\beta_2x^2+\mu$$
$$\Delta y=\alpha_0+\Delta\alpha_1x+\epsilon$$
in R ...
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3
votes
0
answers
293
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What's the difference between Gregory Mankiw's "Macroeconomics" 4th ed. and 10th ed.?
I am planning to use Gregory Mankiw's Macroeconomics (not to be confused with his Principles of Economics) for self-studying macroeconomics, along with David Weil's Economic Growth. As you can see, ...
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