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The feedback equilibria of a differential game of capitalism. (English) Zbl 0722.90017
The paper deals with the workers vs. capitalists differential game originally proposed by K. Lancaster [J. Pol. Econ. 87, 1092-1109 (1973)] and later extended by M. Pohjola [J. Econ. Dyn. Control 6, 173-186 (1983)], T. Basar, A. Haurie and G. Ricci [ibid. 9, 101-125 (1985)] and others. For a discussion of the literature, see M. Pohjola [in: Dynamic games and applications in economics, 7th Annu. Conf., Econ. Dyn. Control, London 1985, Lect. Notes Econ. Math. Syst. 265, 103-133 (1986; Zbl 0586.90109)]. The paper at hand extends the work by Basar, Haurie and Ricci by addressing the question of the existence of a feedback Stackelberg equilibrium and studies the equilibrium path in more detail, for example, convergence to steady state, monotonicity and sensitivity.

91B62 Economic growth models
91A23 Differential games (aspects of game theory)
91B40 Labor market, contracts (MSC2010)
91A40 Other game-theoretic models
Full Text: DOI
[1] Başar, Tamer; Haurie, Alain, Feedback equilibria in differential games with structural and modal uncertainties, (), 163-201
[2] Başar, Tamer; Haurie, Alain; Ricci, Gianni, On the dominance of capitalists leadership in a ‘feedback-stackelberg’ solution of a differential game model of capitalism, Journal of economic dynamics and control, 9, 101-125, (1985)
[3] Başar, Tamer; Olsder, Geert Jan, Dynamic noncooperative game theory, (1982), Academic Press London · Zbl 0479.90085
[4] Hoel, Michael, Distribution and growth as a differential game between workers and capitalists, International economic review, 19, 335-350, (1978) · Zbl 0387.90119
[5] Kemp, Murray C.; Long, Ngo Van, Union power in the long run: the case in which capitalists save optimally, IFO-studien, (1989), forthcoming
[6] Kemp, Murray C.; Long, Ngo Van; Shimomura, Koji, Labour unions and the theory of international trade, (1990), North-Holland Amsterdam
[7] Lancaster, Kelvin, The dynamic inefficiency of capitalism, Journal of political economy, 87, 1092-1109, (1973)
[8] Manning, Richard; Shea, Koon Lam, The limit of union power in the long run, (1988), State University of New York Albany, NY · Zbl 0664.90024
[9] Pohjola, Matti, Nash and Stackelberg solutions in a differential game of capitalism, Journal of economic dynamics and control, 6, 173-186, (1983) · Zbl 0753.90014
[10] Ramsey, Frank P., A mathematical theory of saving, Economic journal, 38, 543-549, (1928)
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