IDEAS home Printed from https://ideas.repec.org/a/che/chepap/v19y2007i1p24-32.html
   My bibliography  Save this article

Moving Economic Models from the Chalk Board to the Computer: A Computer-Based Assignment Based on a Dynamic Cournot Model

Author

Listed:
  • Tim Kochanski

    (Portland State University)

Abstract

This paper presents an iterative model, programmed in Mathematica, which solves time paths for repeated Cournot games allowing us to see how output, price, profits, and market share in the two-firm case change over time when one firm experiences per turn marginal cost reductions. By adjusting the marginal cost reduction rate for one firm and iterating, students can explore the various solutions and gain a better understanding of how the variables in the model diverge over time and the properties of that divergence. More generally, students gain experience designing models and programming in Mathematica and furthermore develop a deeper understanding of iteration in simulations.

Suggested Citation

  • Tim Kochanski, 2007. "Moving Economic Models from the Chalk Board to the Computer: A Computer-Based Assignment Based on a Dynamic Cournot Model," Computers in Higher Education Economics Review, Economics Network, University of Bristol, vol. 19(1), pages 24-32.
    • Handle: RePEc:che:chepap:v:19:y:2007:i:1:p:24-32
    as

    Download full text from publisher

    File URL: https://www.economicsnetwork.ac.uk/cheer/ch19/kochanski.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Belsley, David A, 1999. "Mathematica as an Environment for Doing Economics and Econometrics," Computational Economics, Springer;Society for Computational Economics, vol. 14(1-2), pages 69-87, October.
    2. Hans M. Amman & David A. Kendrick, . "Computational Economics," Online economics textbooks, SUNY-Oswego, Department of Economics, number comp1.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Tim Kochanski, 2012. "Toward Teaching Markets as Complex Systems: A Web Based Simulation Assignment Implemented in Netlogo," International Review of Economic Education, Economics Network, University of Bristol, vol. 11(2), pages 102-114.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Jesús Fernández-Villaverde & Juan F. Rubio-Ramirez, 2001. "Comparing dynamic equilibrium economies to data," FRB Atlanta Working Paper 2001-23, Federal Reserve Bank of Atlanta.
    2. Blueschke-Nikolaeva, V. & Blueschke, D. & Neck, R., 2012. "Optimal control of nonlinear dynamic econometric models: An algorithm and an application," Computational Statistics & Data Analysis, Elsevier, vol. 56(11), pages 3230-3240.
    3. Hugo Benítez-Silva & Eva Cárceles-Poveda & Selçuk Eren, 2011. "Effects of Legal and Unauthorized Immigration on the U.S. Social Security System," Working Papers wp250, University of Michigan, Michigan Retirement Research Center.
    4. Herings, P. J. J. & Polemarchakis, H., 2002. "Equilibrium and arbitrage in incomplete asset markets with fixed prices," Journal of Mathematical Economics, Elsevier, vol. 37(2), pages 133-155, April.
    5. Arnulfo Rodriguez, 2004. "Robust Control: A Note on the Timing of Model Uncertainty," Computing in Economics and Finance 2004 147, Society for Computational Economics.
    6. Peter B. Dixon & Maureen T. Rimmer, 2005. "Explaining a dynamic CGE simulation with a trade-focused back-of-the-envelope analysis: the effects of eCommerce on Australia," Chapters, in: Sisira Jayasuriya (ed.), Trade Theory, Analytical Models and Development, chapter 10, Edward Elgar Publishing.
    7. John Rust, 1997. "Using Randomization to Break the Curse of Dimensionality," Econometrica, Econometric Society, vol. 65(3), pages 487-516, May.
    8. Arpita Chatterjee, 2013. "Globalization and Monetary Policy: An Empirical Analysis," Discussion Papers 2013-08, School of Economics, The University of New South Wales.
    9. Linnea Polgreen & Pedro Silos, 2008. "Capital-Skill Complementarity and Inequality: A Sensitivity Analysis," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 11(2), pages 302-313, April.
    10. Eduardo Haddad & Alexandre A. Porsse & Eduardo P. Ribeiro, 2006. "Modeling Interjurisdictional Tax Competition in a Federal System," ERSA conference papers ersa06p359, European Regional Science Association.
    11. David Kendrick & P. Mercado & Hans Amman, 2006. "Computational Economics: Help for the Underestimated Undergraduate," Computational Economics, Springer;Society for Computational Economics, vol. 27(2), pages 261-271, May.
    12. Siem Jan Koopman & Neil Shephard, 2002. "Testing the Assumptions Behind the Use of Importance Sampling," Economics Papers 2002-W17, Economics Group, Nuffield College, University of Oxford.
    13. James Hansen & James McDonald & Panayiotis Theodossiou & Brad Larsen, 2010. "Partially Adaptive Econometric Methods For Regression and Classification," Computational Economics, Springer;Society for Computational Economics, vol. 36(2), pages 153-169, August.
    14. Di Nicolo, G. & Gamba, A. & Lucchetta, M., 2011. "Capital Regulation, Liquidity Requirements and Taxation in a Dynamic Model of Banking," Discussion Paper 2011-090, Tilburg University, Center for Economic Research.
    15. Geweke, J. & Joel Horowitz & Pesaran, M.H., 2006. "Econometrics: A Bird’s Eye View," Cambridge Working Papers in Economics 0655, Faculty of Economics, University of Cambridge.
    16. Doraszelski, Ulrich & Kryukov, Yaroslav & Borkovsky, Ron N., 2008. "A User's Guide to Solving Dynamic Stochastic Games Using the Homotopy Method," CEPR Discussion Papers 6733, C.E.P.R. Discussion Papers.
    17. Park, Byeong U. & Sickles, Robin C. & Simar, Leopold, 2003. "Semiparametric-efficient estimation of AR(1) panel data models," Journal of Econometrics, Elsevier, vol. 117(2), pages 279-309, December.
    18. Amman, Hans M. & Kendrick, David A., 1998. "Computing the steady state of linear quadratic optimization models with rational expectations," Economics Letters, Elsevier, vol. 58(2), pages 185-191, February.
    19. John Stachurski, 2009. "Economic Dynamics: Theory and Computation," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262012774, December.
    20. Richard Dennis & Tatiana Kirsanova, 2010. "Expectations traps and coordination failures: selecting among multiple discretionary equilibria," Working Paper Series 2010-02, Federal Reserve Bank of San Francisco.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:che:chepap:v:19:y:2007:i:1:p:24-32. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Martin Poulter (email available below). General contact details of provider: https://www.economicsnetwork.ac.uk/cheer .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.