Group for Research in Decision Analysis


Markov Perfect Equilibrium Advertising Strategies of Lanchester Duopoly Model

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We propose a numerical approach to compute stationary Markov perfect Nash equilibrium advertising strategies of Lanchester model. The algorithm can be implemented using a standard mathematical package and, most importantly, it does not require that the players discount their future earnings at a zero rate, an assumption which has been made in the literature.

, 17 pages