Find agent 1 contribution in the subgame perfect equilibrium

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Question: Two agents are deciding to contribute to a public good. We have gi+xi=yi, where gi is an agent i's contribution to the public good and yi is his income. Suppose y1=20 and y2=10. Agent i's utility is Ui=ln(xi)+ln(g1+g2). Suppose agent 1 makes his contribution first, and then agent 2 makes his contribution. Find agent 1's contribution in the subgame perfect equilibrium.

Reference no: EM133341677

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