Firms, technology, training and government fiscal policies: An evolutionary approach

Abstract

<p style='text-indent:20px;'>In this paper we propose and analyze a game theoretical model regarding the dynamical interaction between government fiscal policy choices toward innovation and training (I&amp;T), firm's innovation, and worker's levels of training and education. We discuss four economic scenarios corresponding to strict pure Nash equilibria: the government and I&amp;T poverty trap, the I&amp;T poverty trap, the I&amp;T high premium niche, and the I&amp;T ideal growth. The main novelty of this model is to consider the government as one of the three interacting players in the game that also allow us to analyse the I&amp;T mixed economic scenarios with a unique strictly mixed Nash equilibrium and with I&amp;T evolutionary dynamical cycles.</p>