Bismark Owusu Tawiah University of LAquila -Italy OVERVIEW - - PowerPoint PPT Presentation

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Bismark Owusu Tawiah University of LAquila -Italy OVERVIEW - - PowerPoint PPT Presentation

Mar 05, 2023 557 likes •848 views

Bismark Owusu Tawiah University of LAquila -Italy OVERVIEW Introduction Competitive Model between Farmers and Agro- Companies Competitive Model with External Regulator Discussion INTRODUCTION The paper present a first

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Bismark Owusu Tawiah University of L’Aquila-Italy

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OVERVIEW

 Introduction

 Competitive Model between Farmers and Agro-

Companies

 Competitive Model with External Regulator  Discussion

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INTRODUCTION

 The paper present a first non-cooperative model between

agro-Companies and farmers where a poverty trap is

  • identified. Starting from a non-innovative economy,

innovative agro-Companies cannot support their strategy, since their incomes are discouraging. The main characteristic of this model is that the poverty trap is a Nash equilibria, stable in an evolutionary viewpoint and Pareto-in efficient.

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The goal is to mathematically understand and fully characterize poverty traps, find alternative global

  • ptimum in the overall strategy-space and promote the

economy such that all the three players farmers, Agro- Companies and the external regulator maximizes income The external regulator, in a Two-phase process (loans, taxes) achieves a common wealth, with a prosperous economy, with innovative and skilled Cocoa farmers

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Poverty Trap

 Definition : A poverty trap is any self-reinforcing

mechanism that endures poverty.

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Poverty Trap

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Crucial questions

 Why is the poverty trap recurrent despite production

each year?

 And is there any scenario in which greater income can

be attained by all players enhancing the growth of the economy which is consistent with poverty reduction?

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Competitive model between Farmers and Agro-Companies

Game in normal form : Players : Farmers Strategies: Companies Strategies:

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Economic parameters

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Economic parameters

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Assumptions

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Incomes

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Incomes

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Constraints

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Nash Equilibrium

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Mixed Strategies & Expected Income

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Pareto Equilibrium

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Mixed Strategies

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Competitive model with external regulator

 Game with external :

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Income

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Expected Income

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Dynamics under Normal Game

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Dynamics under Loan for Game(E)

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Dynamics under Tax for Game(E)

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Conclusion

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References

[1]. Models of Poverty and Planned Change: A Framework for Synthesis, Journal of Sociology and Social Welfare, Vol. V, No. 3 (May 1976), 316-325. [2] E. Accinelli, S. London, L. F. Punzo and E. J. S. Carrera, Poverty traps, rationality and evolution, Dynamics, Games and Science I , 1 (2011),3752. [3] ] E. Accinelli, S. London and E. Sanchez, A model of imitative behavior in the population of firms and workers, Technical Report, Department of Economics, University of Siena, 2009. [4] C. Azariadis and J. Stachurski, Chapter 5 poverty traps, in Handbook

  • f Economic Growth, Vol. 1 (eds. P. Aghion and S. Durlauf), 2005, 295384.

.

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References

[5] ] C. B. Barrett and B. M. Swallow, Fractal poverty traps, World Development, 34 (2006),115 [6] J. Nash, Non-cooperative games, The Annals of Mathematics, 54 (1951), 286295.