Computing Markov-Perfect Nash Equilibria: Numerical Implications of a Dynamic Differentiated Product Model
In this article we develop and illustrate a simple algorithm for computing Markov-perfect Nash equilibria. The advantage of the Markov-perfect framework is that it is flexible enough to reproduce important aspects of reality in a variety of market settings. As a result, we hope that our article and (perhaps improved) versions of the associated algorithms will eventually be a part of a tool kit that allows researchers to go back and forth between the implications of economic theory and the characteristics of alternative datasets.
Year of publication: |
1994
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Authors: | Pakes, Ariel ; McGuire, Paul |
Published in: |
RAND Journal of Economics. - The RAND Corporation, ISSN 0741-6261. - Vol. 25.1994, 4, p. 555-589
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Publisher: |
The RAND Corporation |
Saved in:
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