Footnote:
In: Scandinavian Journal of Economics
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments January 29, 2017 erstellt
Description:
We expand the scope of the two-aggregate method by applying it to a situation where many heterogeneous players are free to contribute to both aggregates. Such situations naturally arise in various resource allocation problems. Hence our method is useful in many applications. A production-appropriation model is employed to illustrate how the problem of establishing the Nash equilibrium can be reduced from solving n > 2 best response functions in n unknowns to solving two consistency conditions in two unknowns. We then conduct a comparative static exercise that the conventional approach could not handle easily --- if at all --- to demonstrate the power of our method