Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Solve for the symmetric pure strategy Nash equilibrium 1. (25 points) There are 10 fishermen in a small fishing village. Each chooses a number of

Solve for the symmetric pure strategy Nash equilibrium

image text in transcribed
1. (25 points) There are 10 fishermen in a small fishing village. Each chooses a number of hours x; E [0, 10] to spend fishing each day. Each hour spent fishing reduces a fisherman's payoff by 50, but increases the number of fish he catches. The marginal product of a fisherman's time depends both on how much time he spends fishing (he experiences diminishing returns) and on how much time other fishermen spend fishing (the more time others spend fishing, the harder it is to catch a fish). Specifically, each hour that others spend fishing reduces marginal product by 1/10, while each hour he spends fishing reduces his marginal product by 2: When the strategy profile is x, fisherman i catches fi(x) = (15 - Xi - 10 Citi x;) x; fish. The fisherman then sells his catch at a price of p = 10 per fish, and receives a payoff of 10fi(x). Thus, fisherman i's payoffs are given by ui(x) = 10fi(x) - 50xi. Solve for the symmetric pure strategy Nash equilibrium of this game

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Experimental Econophysics Properties And Mechanisms Of Laboratory Markets

Authors: Ji Ping Huang

1st Edition

3662442345, 9783662442340

More Books

Students also viewed these Economics questions