O'Sullivan, 2.12) Consider a region where the self-sufficient wage is constant at $4. Suppose the payoff profit) from innovation in the city with a population n measured in thousands is given by: π (n) = 2+n¹/² = (n/10) 5.1 Suppose a group of 1 (thousand) workers form a city. Will other workers have an incentive to join the cluster? 5.2 Suppose a group of 9 (thousand) workers form a city. Will other workers have an incentive to join the cluster? 5.3 Compute the (stable) equilibrium size of the innovation city.
O'Sullivan, 2.12) Consider a region where the self-sufficient wage is constant at $4. Suppose the payoff profit) from innovation in the city with a population n measured in thousands is given by: π (n) = 2+n¹/² = (n/10) 5.1 Suppose a group of 1 (thousand) workers form a city. Will other workers have an incentive to join the cluster? 5.2 Suppose a group of 9 (thousand) workers form a city. Will other workers have an incentive to join the cluster? 5.3 Compute the (stable) equilibrium size of the innovation city.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
Related questions
Question
![(O'Sullivan, 2.12) Consider a region where the self-sufficient wage is constant at $4. Suppose the payoff
(profit) from innovation in the city with a population n measured in thousands is given by:
π (n) = 2 +n¹/² − (n/10)
-
5.1 Suppose a group of 1 (thousand) workers form a city. Will other workers have an incentive to join
the cluster?
5.2 Suppose a group of 9 (thousand) workers form a city. Will other workers have an incentive to join
the cluster?
5.3 Compute the (stable) equilibrium size of the innovation city.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fc0794a56-f4e7-4929-8b4c-b0859ba3a946%2F9fda67e8-281e-4433-9312-ac8e3f9bbc23%2Fr57y5zf_processed.png&w=3840&q=75)
Transcribed Image Text:(O'Sullivan, 2.12) Consider a region where the self-sufficient wage is constant at $4. Suppose the payoff
(profit) from innovation in the city with a population n measured in thousands is given by:
π (n) = 2 +n¹/² − (n/10)
-
5.1 Suppose a group of 1 (thousand) workers form a city. Will other workers have an incentive to join
the cluster?
5.2 Suppose a group of 9 (thousand) workers form a city. Will other workers have an incentive to join
the cluster?
5.3 Compute the (stable) equilibrium size of the innovation city.
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