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Iterative Monotone Comparative Statics

Author

Listed:
  • Lukasz Balbus
  • Wojciech Olszewski
  • Kevin Reffett
  • Lukasz Wozny
Abstract
For an increasing upper order hemi-continuous correspondence F selfmapping sigma-complete lattice A, we first provide tight fixed-point bounds for sufficiently large iterations on F starting from any initial point a in A. We use this result for conducting iterative fixed-point comparative statics, and then apply our results to monotone games and economies. For games of strategic complementarities, we improve the correspondence principle based results of Echenique (2002) by allowing for divergent learning processes, unstable fixed points, equilibrium indeterminacies, and unordered perturbations. We also apply our results to the comparative statics of stationary equilibria in large economies and the set of recursive equilibria in macroeconomic models with indeterminacies.

Suggested Citation

  • Lukasz Balbus & Wojciech Olszewski & Kevin Reffett & Lukasz Wozny, 2022. "Iterative Monotone Comparative Statics," KAE Working Papers 2022-072, Warsaw School of Economics, Collegium of Economic Analysis.
    • Handle: RePEc:sgh:kaewps:2022072
    as

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    File URL: http://kolegia.sgh.waw.pl/pl/KAE/Documents/WorkingPapersKAE/WPKAE_2022_072.pdf
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    comparative statics; comparative dynamics; adaptive learning; monotone iterations; games with strategic complementarities;
    All these keywords.

    JEL classification:

    • C62 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Existence and Stability Conditions of Equilibrium
    • C65 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Miscellaneous Mathematical Tools
    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games

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