【正文】 eoryLecture 17 14 Bank runs: timing of the game ? The timing of this game is as follows ? Date 1 (before the bank’s investment matures) ? Two investors play a simultaneous move game ? If both make withdrawals then each receives r and the game ends ? If only one makes a withdrawal then she receives D, the other receives 2rD, and the game ends ? If neither makes a withdrawal then the project matures and the game continues to Date 2. ? Date 2 (after the bank’s investment matures) ? Two investors play a simultaneous move game ? If both make withdrawals then each receives R and the game ends ? If only one makes a withdrawal then she receives 2RD, the other receives D, and the game ends ? If neither makes a withdrawal then the bank returns R to each investor and the game ends. June 12, 2021 73347 Game TheoryLecture 17 15 Bank runs: game tree 1 W NW 2 W NW 1 2 W NW W NW W NW 2 a subgame One subgameperfect Nash equilibrium ( NW W, NW W ) W r, r NW Date 1 Date 2 W: withdraw NW: not withdraw 2 D, 2r–D 2r–D, D R, R D, 2R–D 2R–D, D R, R June 12, 2021 73347 Game TheoryLecture 17 16 Bank runs: game tree 1 W NW 2 W NW 1 2 W NW W NW W NW 2 One subgameperfect Nash equilibrium ( W W, W W ) W r, r NW Date 1 Date 2 W: withdraw NW: not withdraw 2 D, 2r–D 2r–D, D R, R D, 2R–D 2R–D, D R, R a subgame June 12, 2021 73347 Game TheoryLecture 17 17 Tariffs and imperfect international petition ( of Gibbons) ? Two identical countries, 1 and 2, simultaneously choose their tariff rates, denoted t1, t2, respectively. ? Firm 1 from country 1 and firm 2 from country 2 produce a homogeneous product for both home consumption and export. ? After observing the tariff rates chosen by the two countries, firm 1 and 2 simultaneously chooses quantities for home consumption and for export, denoted by (h1, e1) and (h2, e2), respectively. ? Market price in two countries Pi(Qi)=a–Qi, for i=1, 2. ? Q1=h1+e2, Q2=h2+e1. ? Both firms have a constant marginal cost c. ? Each firm pays tariff on export to the other country. June 12, 2021 73347 Game TheoryLecture 17 18 Ta