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Aggregate comparative statics

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  • Acemoglu, Daron
  • Jensen, Martin Kaae

Abstract

In aggregative games, each playerʼs payoff depends on her own actions and an aggregate of the actions of all the players. Many common games in industrial organization, political economy, public economics, and macroeconomics can be cast as aggregative games. This paper provides a general and tractable framework for comparative static results in aggregative games. We focus on two classes of games: (1) aggregative games with strategic substitutes and (2) nice aggregative games, where payoff functions are continuous and concave in own strategies. We provide simple sufficient conditions under which positive shocks to individual players increase their own actions and have monotone effects on the aggregate. The results are illustrated with applications to public good provision, contests, Cournot competition and technology choices in oligopoly.

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Bibliographic Info

Article provided by Elsevier in its journal Games and Economic Behavior.

Volume (Year): 81 (2013)
Issue (Month): C ()
Pages: 27-49

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Handle: RePEc:eee:gamebe:v:81:y:2013:i:c:p:27-49

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Web page: http://www.elsevier.com/locate/inca/622836

Related research

Keywords: Aggregative games; Strategic substitutes; Nice games; Comparative statics; Contests; Patent races; Public good provision; Cournot model;

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Blog mentions

As found by EconAcademics.org, the blog aggregator for Economics research:
  1. “Aggregate Comparative Statics,” D. Acemoglu & M. K. Jensen (2011)
    by afinetheorem in A Fine Theorem on 2012-09-19 08:57:01
  2. “Aggregate Comparative Statics,” D. Acemoglu & M. K. Jensen (2011)
    by afinetheorem in A Fine Theorem on 2012-09-19 08:57:01
Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
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Cited by:
  1. Sunanda Roy & Tarun Sabarwal, 2010. "Characterizing Stability Properties in Games with Strategic Substitutes," WORKING PAPERS SERIES IN THEORETICAL AND APPLIED ECONOMICS 201003, University of Kansas, Department of Economics, revised Oct 2011.
  2. Daron Acemoglu & Martin Kaae Jensen, 2012. "Robust Comparative Statics in Large Dynamic Economies," Levine's Working Paper Archive 786969000000000507, David K. Levine.
  3. Tobias Harks & Philipp von Falkenhausen, 2013. "Quantitative Comparative Statics for a Multimarket Paradox," Papers 1307.5617, arXiv.org, revised Dec 2013.
  4. Martimort, David & Stole, Lars, 2011. "Aggregate Representations of Aggregate Games," MPRA Paper 32871, University Library of Munich, Germany.
  5. Martimort, David & Stole, Lars, 2012. "Representing equilibrium aggregates in aggregate games with applications to common agency," Games and Economic Behavior, Elsevier, vol. 76(2), pages 753-772.
  6. Grigoriadis, Theocharis, 2013. "A political theory of Russian orthodoxy: Evidence from public goods experiments," Discussion Papers 2013/14, Free University Berlin, School of Business & Economics.
  7. Peter Neary, 2009. "Two and a Half Theories of Trade," Economics Series Working Papers 466, University of Oxford, Department of Economics.
  8. Schroyen, Fred & Treich, Nicolas, 2013. "The Power of Money: Wealth Effects in Contests," Discussion Paper Series in Economics 13/2013, Department of Economics, Norwegian School of Economics.
  9. Martin Kaae Jensen, 2012. "Distributional Comparative Statics," Discussion Papers 12-08, Department of Economics, University of Birmingham.
  10. Garfinkel , Michelle & Skaperdas, Stergios & Syropoulos, Constantinos, 2012. "Trade and Insecure Resources: Implications for Welfare and Comparative Advantage," School of Economics Working Paper Series 2012-8, LeBow College of Business, Drexel University.
  11. Andrew Monaco & Tarun Sabarwal, 2012. "Games with Strategic Heterogeneity," WORKING PAPERS SERIES IN THEORETICAL AND APPLIED ECONOMICS 201240, University of Kansas, Department of Economics, revised Nov 2012.
  12. Andrew Monaco & Tarun Sabarwal, 2012. "Monotone Comparative Statics in Games with both Strategic Complements and Strategic Substitutes," WORKING PAPERS SERIES IN THEORETICAL AND APPLIED ECONOMICS 201236, University of Kansas, Department of Economics, revised Aug 2012.

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