A Dynamic Nash Game Model of Oil Market Disruption and Strategic Stockpiling
Frederic H. Murphy, Michael A. Toman, Howard J. Weiss
Operations Research · 1989 · Volume 37 · Issue 6
Abstract
In this paper we present and analyze a Nash dynamic game model for investigating public and private sector oil inventory policies in unstable world oil markets. Conceptual results about the model include simple, verifiable conditions for uniqueness and stability of solutions, along with characterizations of optimal policies. We also present results and discuss computational issues that arise in determining subgame perfect infinite-horizon equilibria, using a steady-state policy iteration approach.
Keywords
economics: energy, world oil markets, games/group decisions: stochastic games of strategic inventories
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