Capital accumulation games of infinite duration

Chaim Fershtman*, Eitan Muller

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

49 Scopus citations


Consider a market in which firms accumulate capital according to the Nerlove-Arrow capital accumulation equation. Each player chooses a path of investment and thus an induced path of capital to maximize his total discounted profits which depend on his own capital and the capital stocks of his rivals. Existence is proved for such a nonzero sum, infinite horizon differential game and conditions under which the game converges to a particular stationary point, regardless of the initial conditions are shown. Thus, the game possesses the property of conditional global asymptotic stability.

Original languageEnglish
Pages (from-to)322-339
Number of pages18
JournalJournal of Economic Theory
Issue number2
StatePublished - Aug 1984
Externally publishedYes


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