A quasi-variational approach to a competitive economic equilibrium problem without strong monotonicity assumption

This paper is focused on the investigation of the Walrasian economic equilibrium problem involving utility functions. The equilibrium problem is here reformulated by means of a quasi-variational inequality problem. Our goal is to give an existence result without assuming strong monotonicity conditions. To this end, we make use of a perturbation procedure. In particular, we will consider suitable perturbed utility functions whose gradient satisfies a strong monotonicity condition and whose associated equilibrium problem admits a solution. Then, we will prove that the limit solution solves the unperturbed problem. We stress out that our result allows us to consider a wide class of utility functions in which the Walrasian equilibrium problem may be solved.     

A contribution to the Zarankiewicz problem

Given positive integers let z(m,n,s,t) be the maximum number of ones in a (0,1) matrix of size m×n that does not contain an all ones submatrix of size s×t. We show that if s?2 and t?2, then for every k=0,…,s-2,

z(m,n,s,t)?(s-k-1)^1/tnm^1-1/t+kn+(t-1)m^1+k/t.     

A new method for solving equilibrium problem fixed point problem and variational inequality problem with application to optimization

In this paper, we introduce a new iterative scheme for finding a common element of the set of solutions of an equilibrium problem, the set of common fixed point for a family of infinitely nonexpansive mappings and the set of solutions of the variational inequality for α$\alpha$-inverse-strongly monotone mappings in a Hilbert space. Under suitable conditions, some strong convergence theorems for approximating a common element of the above three sets are obtained. As applications, at the end of the paper we utilize our results to study the optimization problem and some convergence problem for strictly pseudocontractive mappings. The results presented in the paper extend and improve some recent results of Yao and Yao [Y.Y. Yao, J.C. Yao, On modified iterative method for nonexpansive mappings and monotone mappings, Appl. Math. Comput. 186 (2) (2007) 1551–1558], Plubtieng and Punpaeng [S. Plubtieng, R. Punpaeng, A new iterative method for equilibrium problems and fixed point problems of nonlinear mappings and monotone mappings, Appl. Math. Comput. (2007) doi:10.1016/j.amc.2007.07.075], S. Takahashi and W. Takahashi [S. Takahashi, W. Takahashi, Viscosity approximation methods for Equilibrium problems and fixed point problems in Hilbert spaces, J. Math. Anal. Appl. 331 (2006) 506–515], Su, Shang and Qin [Y.F. Su, M.J. Shang, X.L. Qin, An iterative method of solution for equilibrium and optimization problems, Nonlinear Anal. (2007) doi:10.1016/j.na.2007.08.045] and Chang, Cho and Kim [S.S. Chang, Y.J. Cho, J.K. Kim, Approximation methods of solutions for equilibrium problem in Hilbert spaces, Dynam. Systems Appl. (in print)].     

A contribution to the closed geodesic problem

The closed geodesic problem has been solved by many authors under additional hypothesis. In this paper we develop a new way to solve this problem, by defining finitely many obstruction classes. This permits to enlarge significantly the family of manifolds for which this problem is solved. Our method which relies on the concept of A_∞-section of a homomorphism of differential graded algebras, shows explicitly how the natural structure of shc-algebra on the singular cochains of a space comes into play.     

A FPTAS for computing a symmetric Leontief competitive economy equilibrium

In this paper, we consider a linear complementarity problem (LCP) arisen from the Nash and Arrow–Debreu competitive economy equilibria where the LCP coefficient matrix is symmetric. We prove that the decision problem, to decide whether or not there exists a complementary solution, is NP-complete. Under certain conditions, an LCP solution is guaranteed to exist and we present a fully polynomial-time approximation scheme (FPTAS) for approximating a complementary solution, although the LCP solution set can be non-convex or non-connected. Our method is based on approximating a quadratic social utility optimization problem (QP) and showing that a certain KKT point of the QP problem is an LCP solution. Then, we further show that such a KKT point can be approximated with a new improved running time complexity ${{O}((\frac{n^4}{\epsilon})\log\log(\frac{1}{\epsilon}))}$ arithmetic operation in accuracy ${\epsilon \in (0,1)}$ . We also report preliminary computational results which show that the method is highly effective. Applications in competitive market model problems with other utility functions are also presented, including global trading and dynamic spectrum management problems.     

Lagrangean variables in infinite dimensional spaces for a dynamic economic equilibrium problem

This paper is focused on the study of a dynamic competitive equilibrium by using Lagrangean multipliers. This mathematical formulation allows us the improve the Walrasian model by considering the common possibility of an uncharged delayed payment in a given time (for example, by using a credit card). Firstly the economic equilibrium problem is reformulated as an evolutionary variational problem; then the Lagrangean theory in infinite dimensional spaces is applied. Thanks to the application of this theory we obtain the existence of Lagrangean multipliers, which allows us to give a computational procedure for the equilibrium solutions.     

A Stackelberg equilibrium for a missile procurement problem

This paper deals with a procurement problem of missiles involving the efficient assignment of the missiles to some targets. Within a fixed amount of budget, a leader purchases several types of missiles, by which he aims to damage as much value as possible a follower hides into some facilities later. The effectiveness of the missile depends on the type of missile and facility. A payoff of the game is the expected amount of destroyed value. The problem is generalized as a two-person zero-sum game of distributing discrete resources with a leader and a follower. Our problem is to derive a Stackelberg equilibrium for the game. This type of game has an abundance of applications. The problem is first formulated into an integer programming problem with a non-separable objective function of variables and it is further equivalently transformed into a maximin integer knapsack problem. We propose three exacts methods and an approximation method for an optimal solution.     

A capacitated competitive facility location problem

We consider a mathematical model similar in a sense to competitive location problems. There are two competing parties that sequentially open their facilities aiming to “capture” customers and maximize profit. In our model, we assume that facilities’ capacities are bounded. The model is formulated as a bilevel integer mathematical program, and we study the problem of obtaining its optimal (cooperative) solution. It is shown that the problem can be reformulated as that of maximization of a pseudo-Boolean function with the number of arguments equal to the number of places available for facility opening. We propose an algorithm for calculating an upper bound for values that the function takes on subsets which are specified by partial (0, 1)-vectors.     

A contribution to the stochastic flow shop scheduling problem

This paper deals with performance evaluation and scheduling problems in m machine stochastic flow shop with unlimited buffers. The processing time of each job on each machine is a random variable exponentially distributed with a known rate. We consider permutation flow shop. The objective is to find a job schedule which minimizes the expected makespan. A classification of works about stochastic flow shop with random processing times is first given. In order to solve the performance evaluation problem, we propose a recursive algorithm based on a Markov chain to compute the expected makespan and a discrete event simulation model to evaluate the expected makespan. The recursive algorithm is a generalization of a method proposed in the literature for the two machine flow shop problem to the m machine flow shop problem with unlimited buffers. In deterministic context, heuristics (like CDS [Management Science 16 (10) (1970) B630] and Rapid Access [Management Science 23 (11) (1977) 1174]) and metaheuristics (like simulated annealing) provide good results. We propose to adapt and to test this kind of methods for the stochastic scheduling problem. Combinations between heuristics or metaheuristics and the performance evaluation models are proposed. One of the objectives of this paper is to compare the methods together. Our methods are tested on problems from the OR-Library and give good results: for the two machine problems, we obtain the optimal solution and for the m machine problems, the methods are mutually validated.     

A contribution to stability theory for nonlinear Neumann problem

In this paper we study the stability of the solutions of some nonlinear Neumann problems, under perturbations of the domains in the Hausdorff complementary topology. We consider the problem $${{\left\{\begin{array}{c}-\text{ div}\;\left(a\left( x,\nabla u_{\Omega}\right)\right)=0 \;\text{in}\; \Omega \\ {a\left( x, \nabla u_{\Omega}\right) \cdot \nu=0\; \text{on}\; \partial\Omega}\end{array}\right.}}$$ where ${{\mathbf{R}^n \times \mathbf{R}^n \rightarrow \mathbf{R}^n}}$ is a Caratheodory function satisfying the standard monotonicity and growth conditions of order p, 1?<?p?<???. If ?? _h is a uniformly bounded sequence of connected open sets in R ⁿ , n ??? 2, we prove that if ${{\Omega_{h}^{c} \rightarrow \Omega^{c}}}$ in the Hausdorff metric, ${|\Omega_{h}| \rightarrow |\Omega|}$ and the geodetic distances satisfy the inequality ${d_{\Omega}\left( x,y\right) \leq \liminf_{h} d_{\Omega_{h}} \left( x,y\right)}$ for every ${x, y \in \Omega,}$ then ${\nabla u_{\Omega_h} \rightarrow\nabla u_{\Omega}}$ strongly in L ^p , provided that W ^{1, ??}(??) is dense in the space L ^{1, p} (??) of all functions whose gradient belongs to L ^p (??, R ⁿ ).     

On risk averse competitive equilibrium

We discuss risked competitive partial equilibrium in a setting in which agents are endowed with coherent risk measures. In contrast to social planning models, we show by example that risked equilibria are not unique, even when agents’ objective functions are strictly concave. We also show that standard computational methods find only a subset of the equilibria, even with multiple starting points.     

Variational formulation for a general dynamic financial equilibrium problem: Balance law and liability formula

An evolutionary model for a multi-sector, multi-instrument financial equilibrium problem, with a general utility function, different prices for assets and liabilities and including the expenses for the management of the financial institutions is presented. In this general case, we give the evolutionary financial equilibrium conditions and prove their equivalence with an evolutionary variational inequality, from which existence results of the financial equilibrium follow. Moreover, making use of new nonlinear analysis results, we develop a Lagrange theory which allows one to study the behaviour of the financial equilibrium by means of the Lagrange multipliers. As a product of this analysis, we prove that for the financial model an equilibrium law together with a liability formula must be fulfilled, from which the reorganization of the existing financial disequilibrium depends.     

A competitive hub location and pricing problem

We formulate and solve a new hub location and pricing problem, describing a situation in which an existing transportation company operates a hub and spoke network, and a new company wants to enter into the same market, using an incomplete hub and spoke network. The entrant maximizes its profit by choosing the best hub locations and network topology and applying optimal pricing, considering that the existing company applies mill pricing. Customers’ behavior is modeled using a logit discrete choice model. We solve instances derived from the CAB dataset using a genetic algorithm and a closed expression for the optimal pricing. Our model confirms that, in competitive settings, seeking the largest market share is dominated by profit maximization. We also describe some conditions under which it is not convenient for the entrant to enter the market.     

Constrained equilibrium in a bidding problem

There are a number of situations where firms vie for some constrained total quantity by bidding individual quantities but where the allocation is determined on a ‘pro-rated’ basis. One such example is a licenses-on-demand method of import quota allocation. Bidders are constrained to bid at most the total quantity, and if the sum of all bids exceeds this total, the awards are granted proportional to the fractional amounts that the bidders request. In this note, we identify the (Nash) equilibrium of the model, present some examples, and do a sensitivity analysis of the bids as the total amount available changes. We also look into changes of the bids when a new participant enters the bidding process. In an economic context, such allocation methods are shown to be biased in favor of the least efficient firms.     

A method of duality for a mixed vector equilibrium problem

In this paper, a dual scheme for a mixed vector equilibrium problem is introduced by using the method of Fenchel conjugate function. Under the stabilization condition, the relationships between the solutions of mixed vector equilibrium problem (MVEP) and dual mixed vector equilibrium problem (DMVEP) are discussed. Moreover, under the same condition, the solutions of MVEP and DMVEP are proved relating to the saddle points of an associated Lagrangian mapping. As applications, this dual scheme is applied to vector convex optimization and vector variational inequality.     

A duopolistic model of dynamic competitive advertising

This paper proposes a differential game model of competitive advertising decisions for non-durable products by extending the Lanchester model and the Deal model of competitive advertising in the literature. The proposed model is compared empirically with the Lanchester model for model fitting and forecast accuracy. It is shown that the model is suitable for an actual market and out-performs the Lanchester model in forecast accuracy. The model provides a sensible modeling alternative to the Lanchester model for the study of dynamic competitive advertising decisions. Necessary and sufficient conditions for open-loop and closed-loop Nash equilibrium solutions to the model are discussed. A numerical algorithm for open-loop and closed-loop Nash strategies to the model is developed.