We define a class of dynamic Markovian games that we call directional dynamic games (DDG) in which directionality is represented by a partial order on the state space. We propose a fast and robust state recursion algorithm that can find a Markov perfect equilibrium (MPE) via backward induction...

We introduce a computationally tractable dynamic equilibrium model of the automobile market where new and used cars of multiple types (e.g. makes/models) are traded by heterogeneous consumers. Prices and quantities are determined endogenously to equate supply and demand for all car types and...

Are the serves of the world’s best tennis pros consistent with the theoretical predictions of Nash equilibrium in mixed strategies? We analyze their serve direction choices (to the receiver’s left, right or body) with data from an online database called the Match Charting Project. Using a...

This paper compares the performance of the Howard (1960) policy iteration algorithm for infinite-horizon continuous-state Markovian decision processes (MDP's) using alternative random, quasi-random, and deterministic discretizations of the state space, or grids. Each grid corresponds to an...

This chapter summarizes the ability of the models to track the shift in departure rates induced by the 1982 window plan. All forecasts were based on the estimated utility function parameters using data prior to 1982. Using these parameters, predictions were generated from all four models after...