Social Evolution and Aspiration Learning in Asymmetric Duopoly

Central European University Economics Department Working Paper No. 6/2001

24 Pages Posted: 26 Feb 2003

See all articles by Andrzej Baniak

Andrzej Baniak

Central European University (CEU) - Department of Economics

Jacek Cukrowski

CASE - Center for Social and Economic Research

Stepan Cabelka

Charles University in Prague - CERGE-EI, a joint workplace of Charles University and the Economics Institute of the Czech Academy of Sciences

Date Written: 2001

Abstract

In the paper we develop the concept of social evolution and aspiration learning in duopolistic industries. Social learning is analysed in the framework of the model in which aspirations are linked to the normal profit of the economy. The general algorithm of social evolution and learning for asymmetric duopoly is presented and evolutionary equilibrium is examined. The derived results predict that in a duopolistic equilibrium all firms earn equal profits and joint-profit is maximized. The paper generalizes the result of Dixon (2000) and makes the aspiration learning algorithm applicable to the broad class of models.

Keywords: aspiration learning, social evolution, asymmetric duopoly

JEL Classification: L13, D4, C7

Suggested Citation

Baniak, Andrzej and Cukrowski, Jacek and Cabelka, Stepan, Social Evolution and Aspiration Learning in Asymmetric Duopoly (2001). Central European University Economics Department Working Paper No. 6/2001, Available at SSRN: https://ssrn.com/abstract=347900 or http://dx.doi.org/10.2139/ssrn.347900

Andrzej Baniak (Contact Author)

Central European University (CEU) - Department of Economics ( email )

Nador u. 9.
Budapest H-1051
Hungary
(36) 1 327-3231 (Phone)
(36) 1 327-3232 (Fax)

Jacek Cukrowski

CASE - Center for Social and Economic Research ( email )

Center for Social and Economic Research,
Warsaw
Poland

Stepan Cabelka

Charles University in Prague - CERGE-EI, a joint workplace of Charles University and the Economics Institute of the Czech Academy of Sciences ( email )

Politickych veznu 7
Prague, 111 21
Czech Republic

HOME PAGE: http://www.cerge-ei.cz

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