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A priori knowledge usually enables us to decide that some coefficients must be zero in the particular equation, while they assume non-zero values in other equations of the system. We said that identification of an equation is based on variables not included (not appearing) in it. To be identifiable an equation must be independent of one or more important variables, which are included in other equations of the system. Such excluded variables, if operative during the sample period, will generate shifts in the other equations of the model, which will in turn identify the particular equation from which they are absent (i.e. in which they appear with zero coefficient).
Based on the a priori information a list can be prepared, which should be as complete as possible, of the factors which are relevant to the phenomenon being studied. The list can help us decide which of these factors would normally appear in each relationship. For example, assume that we want to study the demand for an agricultural product. The demand equation belongs to a system of equations describing the market mechanism.
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A common term for an English auction, a sort of sequential auction during which an auctioneer directs participants to beat the present, standing bid. New bids should increase the p
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This condition is based on a counting rule of the variables included and excluded from the particular equation. It is a necessary but no sufficient condition for the identi
The notion that those that don't contribute to some project might nevertheless get pleasure from it (free riders), evidenced in games like the tragedy of the commons and public pro
The following is a payoff matrix for a non-cooperative simultaneous move game between 2 players. The payoffs are in the order (Player 1; Player 2): What is the Nash Equilibri
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Assuming that there are only 2 airline companies in the world, Delta and US Airways, what is the ((Nash) Equilibrium) or price that each company in the following matrix will charge
Problem:-Two players take turns choosing a number between 1 and 10 (inclusive), and a cumulative total of their choices is kept. The player to take the total exactly to 100 is the
Take a news story, old or recent, and analyze it from a game theoretic perspective. Provide a hard copy of the source of your news story and consult relevant game theoretic literat
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