Question: How do I solve two optimization probs simultaneously?

Hi all,

I would be very happy if someone could help me with this one.

I'm trying to solve for an equilibrium of two functions u and U:

u:=ln(y-p*a-g*m)+(1/(M+m+1))*ln(1-l+e*a)

U:=ln(Y-P*A-G*M)+(1/(m+M+1))*ln(1-L-E*A)

where a,m are the variables of u, A,M are the variables of U, and y,Y,p,P,g,G,l,L,e,E are parameters. All variables and parameters are nonnegative.

I want to maximize u(a,m) s.t. M | max U(A,M) and vice versa, i.e., maximize U(A,M)
s.t. m | max u(a,m). I know that I can't get an explicit solution expressed in parameters for max u and max U (unless anyone has a suggestion?); however, a numeric solution with given values for the parameters would also do.

I tried the optimization package and the NLPSolve command; however, I couldn't figure out how to solve it simultaneously.

Thanks in advance for your help

econ

Please Wait...