Stackelberg-Nash Equilibrium and Perfect Competition in the Solow-Uzawa Growth Model

This study introduces Stackelberg-Nash equilibrium to neoclassical growth theory. It attempts make economic theory more robust in modelling the complexity of market structures. The model is constructed within framework Solow-Uzawa two-sector model. economy composed two sectors. final goods sector same as Solow one-sector which characterized by perfect competition. consumer Uzawa but Stackelberg duopoly. We household behavior with Zhang’s concept disposable income and utility. endogenously determines profits duopoly are equally distributed among homogeneous population. build then identify existence an point through simulation. conduct comparative static analyses some parameters. also compare performance traditional equilibrium. conclude that imperfect competition increases national output, wealth, utility level comparison