Equilibrium Theory for Cournot Oligopolies and Related Games by Pierre von Mouche & Federico Quartieri

Author:Pierre von Mouche & Federico Quartieri
Language: eng
Format: epub
Publisher: Springer International Publishing, Cham

(9)

(10)

The first-order conditions for the government with respect to (s 0, s) are as follows:

(11)

(12)

By solving the simultaneous Eqs. (11) and (12) with respect to (s 0, s), we can arrange the equations as follows:

(13)

(14)

Solving the simultaneous Eqs. (13) and (14) with respect to (s 0, s), we obtain the optimal subsidy levels as follows:

(15)

By we obtain that the optimal subsidy level to each firm is equal to the firm’s output.

By substituting the optimal subsidy levels into the equilibrium variables in Table 3, we obtain the SPNE after privatization as shown in Table 4.Table 4SPNE after privatization

Download

Copyright Disclaimer:
This site does not store any files on its server. We only index and link to content provided by other sites. Please contact the content providers to delete copyright contents if any and email us, we'll remove relevant links or contents immediately.