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)
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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)
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