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A User''s Guide to Solving Dynamic Stochastic Games Using the Homotopy Method

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    Abstract

    This paper provides a step-by-step guide to solving dynamic stochastic games using the homotopy method. The homotopy method facilitates exploring the equilibrium correspondence in a systematic fashion; it is especially useful in games that have multiple equilibria. We discuss the theory of the homotopy method and its implementation and present two detailed examples of dynamic stochastic games that are solved using this method.

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    File URL: http://www.andrew.cmu.edu/user/kryukov/HomotopyGuide.pdf
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    Bibliographic Info

    Paper provided by Carnegie Mellon University, Tepper School of Business in its series GSIA Working Papers with number 2009-E23.

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    Handle: RePEc:cmu:gsiawp:860735799

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    Postal: Tepper School of Business, Carnegie Mellon University, 5000 Forbes Avenue, Pittsburgh, PA 15213-3890
    Web page: http://www.tepper.cmu.edu/

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    Web: http://student-3k.tepper.cmu.edu/gsiadoc/GSIA_WP.asp

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    12. By Kenneth L. Judd & Karl Schmedders & ┼×evin Yeltekin, 2012. "Optimal Rules For Patent Races," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 53(1), pages 23-52, 02.
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