Equilibrium Exit in Stochastically Declining Industries

Cover Equilibrium Exit in Stochastically Declining Industries
Equilibrium Exit in Stochastically Declining Industries
Charles H Fine
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Tj) . ^2^a^)l(x^>, } ^ V^^^djlt} Let e. (0 ^21^^^ for j=l, 2 and every z.
To aid the game-theoretic analysis that follows, we first solve four single-firm problems, two for each firm. That is, by applying the results in the previous section, we derive the optimal exit time for each firm i _a3 J^ there were j firms in the market throughout i's stay in the market. Each single-firm problem is indexed by i and j and takes ^jA*) as the stage payoff. We emphasize that the functions calculated below
...and used in Facts 1-4 _do not represent equilibrium behavior.

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