Abstract
In this paper we try to quantify/measure the main factors that influence the equilibrium outcome and pursued strategies in a simplistic model for the use of fossil versus green energy over time. The model is derived using the standard Solow macro-economic growth model in a two-country setting within a dynamic game perspective. After calibrating the model for a setting of OECD versus non-OECD countries we study what kind of uncertainties affect the outcomes of the
linearized model most, assuming both countries use Nash strategies to cope with shocks that impact the model. The main outcome of this study is that the parameters that occur in the objective of both players seem to carry the most uncertainty for both the outcome of the model and strategies.
linearized model most, assuming both countries use Nash strategies to cope with shocks that impact the model. The main outcome of this study is that the parameters that occur in the objective of both players seem to carry the most uncertainty for both the outcome of the model and strategies.
Original language | English |
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Place of Publication | Tilburg |
Publisher | CentER, Center for Economic Research |
Number of pages | 34 |
Volume | 2018-007 |
Publication status | Published - 12 Feb 2018 |
Publication series
Name | CentER Discussion Paper |
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Volume | 2018-007 |
Keywords
- Differential games
- environemental engineering
- uncertain dynamic systems
- linearization
- economic systems
- open-loop control systems