Description Usage Arguments Value Author(s) Examples

View source: R/imperfect_competition.R

This function numerically finds the equilibrium in a Stackelberg duopoly model with linear functions. For guaranteed existence of equilibrium, cost parameters should be non-negative.
The general functional form for a function of argument x is *f(x) = p_0 + p_1 x*. Parameters p refer to the inverse demand function.
The firm indexed by "l" is the leader, and the one indexed by "f" is the follower.

1 2 | ```
stackelberg_solver(leader = c(0, 1), follower = c(0, 1),
demand = c(0, -1), l0 = 0, f0 = 0)
``` |

`leader` |
vector of coefficients of the leader's cost function which in order must be: intercept of leader's cost function and linear term's parameter of leader's cost function |

`follower` |
vector of coefficients of the follower's cost function which in order must be: intercept of intercept of follower's cost function linear term's parameter of follower's cost function |

`demand` |
vector of coefficients of the market demand curve. Must be, in order, intercept and linear coefficient. |

`l0` |
Initial guess for leader's output. Defaults to 0. Strongly advised not to set this parameter unless you are very aware of what you're doing. |

`f0` |
Initial guess for follower's output. Defaults to 0. Strongly advised not to set this parameter unless you are very aware of what you're doing. |

A list with market price, firm output, profits and market share

Pedro Cavalcante Oliveira, Department of Economics, Fluminense Federal University pedrocolrj@gmail.com

1 2 3 4 | ```
l = c(100, 4)
f = c(120, 5)
p = c(300, -10)
stackelberg_solver(leader = l, follower = f, demand = p)
``` |

Recon documentation built on July 30, 2019, 9:03 a.m.

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