3,498 research outputs found

    On Lie point symmetries in differential games

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    A technique to determine closed-loop Nash equilibria of n-player differential games is developed when their dynamic state-control system is composed of decoupled ODEs. In particular, the theory of Lie point symmetries is exploited to achieve first integrals of such systems.

    Non-isothermal filaments in equilibrium

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    The physical properties of the so-called Ostriker isothermal filament (Ostriker 1964) have been classically used as benchmark to interpret the stability of the filaments observed in nearby clouds. However, recent continuum studies have shown that the internal structure of the filaments depart from the isothermality, typically exhibiting radially increasing temperature gradients. The presence of internal temperature gradients within filaments suggests that the equilibrium configuration of these objects should be therefore revisited. The main goal of this work is to theoretically explore how the equilibrium structure of a filament changes in a non-isothermal configuration. We solve the hydrostatic equilibrium equation assuming temperature gradients similar to those derived from observations. We obtain a new set of equilibrium solutions for non-isothermal filaments with both linear and asymptotically constant temperature gradients. Our results show that, for sufficiently large internal temperature gradients, a non-isothermal filament could present significantly larger masses per unit length and shallower density profiles than the isothermal filament without collapsing by its own gravity. We conclude that filaments can reach an equilibrium configuration under non-isothermal conditions. Detailed studies of both the internal mass distribution and temperature gradients within filaments are then needed in order to judge the physical state of filaments.Comment: 5 pages, 2 figures, accepted for publication in A&

    Government Spending Under Non-Separability: a Theoretical Analysis

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    In this paper we derive analytic implicit form conditions for the qualitative analysis of government spending multipliers and the optimal level of government spending in presence of non-separability between private and public components of aggregate demand. Using the simplest neo-classical flexible price model with no capital accumulation, we show that Edgeworth dependence is not a suitable condition to automatically assess the signs of the consumption and income multipliers, for which a more complex analysis must be carried out. We propose a detailed investigation of the form and the characteristics of the involved utility functions, which are crucial to such evaluation. We also show that if Edgeworth complementarity is strong enough, a public spending stimulus can raise at the same time private consumption and real activity. In order to reconcile our general framework with existing literature, we discuss recent examples of non-separable functional forms from the standpoint of our results, and argue that their consistency relies on specific assumptions about steady- state points.

    Quality, Distance and Trade: a Strategic Approach

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    This paper contributes to the vast and growing literature on trade and quality by providing a parsimonious explanation of the observed increase in unit values (and thus quality) of shipped goods with the distance of the country of destination. This mechanism is based on the influence of distance on firms’ strategic behavior when the quality level of goods is a choice variable for firms, and complements the ones already proposed in the literature. Our approach differs from the extant literature in that it does not rely on technology or preference/income differentials to identify the determinants and drivers of trade flows. Moreover, it allows to clearly disentangle between the price setting and quality choice of firms. We find that distance has an unambiguously positive effect on the average quality of traded goods, as well as a negative one on the likelihood of “trade zeros”. Our results suit the acquired empirical evidence on distance and quality and contribute, therefore, to the research on the determinants of trade performances of firms and countries. Also, our model suggests some useful insights on the relation between distance and free-on-board prices.

    Regulating Environmental Externalities through Public Firms: A Differential Game

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    We investigate the possibility of using public firms to regulate polluting emissions in a Cournot oligopoly where production takes place at constant returns to scale and entails a negative environmental externality. We model the problem as a differential game and investigate (i) the Cournot-Nash game among profit-seeking firms; (ii) the Markov Perfect Nash equilibrium under social planning, where the industry output is entirely controlled by a benevolent planner aiming at the maximisation of social welfare; and (iii) the Markov Perfect Nash equilibrium in a mixed setup where at least one firm is public, while the others remain profit-seeking agents. Our analysis identifies the conditions whereby having a mixed market as a regulatory instrument suffices to drive the industry to the same output, externality and social welfare as under planning, both along the optimal path and in steady state.

    Open Innovation in a Dynamic Cournot Duopoly

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    We analyze an Open Innovation process in a Cournot duopoly using a differential game approach where knowledge spillovers are endogenously determined via the R&D process. The game produces multiple steady states, allowing for an asymmetric solution where a firm may trade off the R&D investment against information absorption from the rival.
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