# Tag Info

### Books friendly to self-studying Industrial Organization

While taking Industrial Organization I remember working with: Strategies and games: theory and practice by Dutta Introduction to industrial organization by Cabral Industrial organization: theory and ...
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### Book recommendations: Introduction to economics

It's great that you're developing an interest in economics. I would suggest Mankiw's Principles of Economics to start with. I believe it meets both your requirements and covers the two major areas of ...
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### Properties on conditional demand correspondence from the textbook of Mas-Colell et al

Let $z_1$ and $z_2$ be $\geq 0$ and solution to $$\min_z \{w^\top z\lvert f(z)\geq q\}$$ then clearly $f(z_1)\geq q$ and $f(z_2)\geq q$ and since $\{z\geq 0\lvert f(z)\geq z \}$ is convex it then ...
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### MWG 8.B.7 - Any strictly dominant strategy must be a pure strategy

Fix any $\sigma_{-i}$. Assume $\sigma_i$ is strictly dominant but not a pure strategy. Let $X$ be the support of $\sigma_i$. Since $\sigma_i$ strictly dominates all pure strategies $s_i\in X$, we have ...
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### Interest rate rule in monetary DSGE model

I've just solved this problem. First of all, your solution does not make too much sense, as in a simple interest rate rule it must hold that the sum of all coefficients must be greater than one. In ...
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### Question on oligopoly.

You have solved the Cournot part correctly, but then you've gone completely off the road, by mistaking economics for mathematics. This usually happens. First of all, you shouldn't assume just any ...
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### separable utility function and cross price effect

The following argument assumes that we are dealing only with interior solutions. Let $(x_1,x_2,x_3)$ be an optimal demand bundle at prices $(p_1,p_2,p_3)$ and income $m$ and assume that $(x_1,x_2,x_3)$...
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### Finding the Pareto efficient allocations

Set of feasible allocations in this economy is: $\mathcal{F}=\{(x_1,x_2,y)\in\mathbb{R}^3_+|x_1+x_2+y^2=30\}$ This set can also be represented in graph in the following way: To determine (interior) ...
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### Stackelberg equilibrium with n+1 firms

Edit: I didn't see that it's a two-stage game. I considered an $n$-stage game in my previous answer. Here's the new modified answer: The leader firm is denoted by $F_0$ and the next $n$ firms by $F_i$ ...
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### Resources to improve my economic intuition

While textbooks are the best way to learn the material (MC=MR etc), here are some suggestions for improving your intuitive understanding of economics. Books The Undercover Economist by Tim Harford ...

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### Cournot Competition game with 3 Firms

Firm 1's profit maximization problem is : \begin{eqnarray*} \max_{q_1} & \ p(q_1 + q_2 + q_3)q_1 - c(q_1) \end{eqnarray*} Firm 1's response to firm 2's and 3's quantity choices will satisfy the ...
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