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A necessary and sufficient condition for a unique maximum with an application to potential games

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  • Christensen, Finn

Abstract

Under regularity and boundary conditions which ensure an interior maximum, I show that there is a unique critical point which is a global maximum if and only if the Hessian determinant of the negated objective function is strictly positive at any critical point. Within the large class of Morse functions, and subject to boundary conditions, this local and ordinal condition generalizes strict concavity, and is satisfied by nearly all strictly quasiconcave functions. The result also provides a new uniqueness theorem for potential games.

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  • Christensen, Finn, 2017. "A necessary and sufficient condition for a unique maximum with an application to potential games," Economics Letters, Elsevier, vol. 161(C), pages 120-123.
    • Handle: RePEc:eee:ecolet:v:161:y:2017:i:c:p:120-123
    DOI: 10.1016/j.econlet.2017.10.008
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    1. Charles D. Kolstad & Lars Mathiesen, 1987. "Necessary and Sufficient Conditions for Uniqueness of a Cournot Equilibrium," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 54(4), pages 681-690.
    2. Varian, Hal R, 1975. "A Third Remark on the Number of Equilibria of an Economy," Econometrica, Econometric Society, vol. 43(5-6), pages 985-986, Sept.-Nov.
    3. Christensen, Finn & Cornwell, Christopher R., 2018. "A strong correspondence principle for smooth, monotone environments," Journal of Mathematical Economics, Elsevier, vol. 77(C), pages 15-24.
    4. Dohtani, Akitaka, 1998. "The system stability of dynamic processes," Journal of Mathematical Economics, Elsevier, vol. 29(2), pages 161-182, March.
    5. Finn Christensen, 2019. "Comparative statics and heterogeneity," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 67(3), pages 665-702, April.
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    7. Hefti, Andreas, 2016. "On the relationship between uniqueness and stability in sum-aggregative, symmetric and general differentiable games," Mathematical Social Sciences, Elsevier, vol. 80(C), pages 83-96.
    8. Monderer, Dov & Shapley, Lloyd S., 1996. "Potential Games," Games and Economic Behavior, Elsevier, vol. 14(1), pages 124-143, May.
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    Cited by:

    1. Guanghui Yang & Chanchan Li & Jinxiu Pi & Chun Wang & Wenjun Wu & Hui Yang, 2021. "Characterizations of Pareto-Nash Equilibria for Multiobjective Potential Population Games," Mathematics, MDPI, vol. 9(1), pages 1-13, January.
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    4. Christensen, Finn & Cornwell, Christopher R., 2018. "A strong correspondence principle for smooth, monotone environments," Journal of Mathematical Economics, Elsevier, vol. 77(C), pages 15-24.
    5. Finn Christensen, 2019. "Comparative statics and heterogeneity," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 67(3), pages 665-702, April.
    6. Christensen, Finn, 2022. "Streaming Stimulates the Live Concert Industry: Evidence from YouTube," International Journal of Industrial Organization, Elsevier, vol. 85(C).
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    8. Vincenzo Scalzo, 2020. "On the uniqueness of Nash equilibrium in discontinuous ordinal and normal form games," Economic Theory Bulletin, Springer;Society for the Advancement of Economic Theory (SAET), vol. 8(1), pages 163-168, April.

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    More about this item

    Keywords

    Optimization; Index theory; Potential games;
    All these keywords.

    JEL classification:

    • C02 - Mathematical and Quantitative Methods - - General - - - Mathematical Economics
    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games

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