Solving dynamic macroeconomic policy games using the algorithm OPTGAME 1.0 We briefly summarise the OPTGAME 1.0 algorithm, which has been developed to determine equilibrium solutions of dynamic games in discrete time. It can be applied to obtain approximate numerical solutions for two-player difference games where the objective functions are quadratic and the dynamic system is nonlinear. The nonlinear system equations are linearized numerically, substituting a linear time-varying system for the nonlinear time-invariant system. OPTGAME 1.0 delivers open-loop and feedback Nash equilibrium solutions, open-loop and feedback Stackelberg equilibrium solutions, and Pareto-optimal solutions. The algorithm has been implemented in the statistical programming system GAUSS. We report about tentative applications of OPTGAME 1.0 to a small macroeconometric model for Austria, AUSTRIA1, to show the feasibility of the calculations and to give examples of how to interpret their results.
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References in zbMATH (referenced in 6 articles , 1 standard article )
Showing results 1 to 6 of 6.
- Blueschke, Dmitri; Neck, Reinhard: Policy interactions in a monetary union: an application of the OPTGAME algorithm (2014)
- Michalak, Tomasz; Engwerda, Jacob; Plasmans, Joseph: A numerical toolbox to solve $N$-player affine LQ open-loop differential games (2011)
- Behrens, Doris A.; Caulkins, Jonathan P.; Feichtinger, Gustav; Tragler, Gernot: Incentive Stackelberg strategies for a dynamic game on terrorism (2007)
- Engwerda, Jacob: Algorithms for computing Nash equilibria in deterministic LQ games (2007)
- Neck, Reinhard; Behrens, Doris: Macroeconomic policies in a monetary union: a dynamic game (2004)
- Hager, Manfred; Neck, Reinhard; Behrens, Doris A.: Solving dynamic macroeconomic policy games using the algorithm OPTGAME 1.0 (2001)