A method for implementing counterfactual experiments in models with multiple equilibria

This paper proposes a homotopy method for implementing counterfactual experiments in empirical models with multiple equilibria. A key assumption is that the equilibrium selection function does not jump discontinuously between equilibria as we continuously change the structural parameters.

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Year of publication:	2012
Authors:	Aguirregabiria, Victor
Published in:	Economics Letters. - Elsevier, ISSN 0165-1765. - Vol. 114.2012, 2, p. 190-194
Publisher:	Elsevier
Subject:	Structural models with multiple equilibria \| Counterfactual experiments \| Equilibrium selection \| Homotopy methods

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Type of publication:	Article
Classification:	C10 - Econometric and Statistical Methods: General. General ; C60 - Mathematical Methods and Programming. General ; L10 - Market Structure, Firm Strategy, and Market Performance. General
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10010572267