Global Journal of Science Frontier Research: F

Mathematics and Decision Sciences

Volume 21 Issue 5 Version 1.0 Year 2021
Type: Double Blind Peer Reviewed International Research Journal
Publisher: Global Journals
Online ISSN: 2249-4626 & Print ISSN: 0975-5896

On Some Applications of Brouwer’s Fixed Point Theorem in

Economics
By Md. Alamgir Hossain, Md. Zulfikar Ali & Md. Asaduzzaman
University of Rajshahi
Abstract- In this paper, we discuss some major applications of Brouwer’s fixed point theorem in
Economics. In the course of research work we mostly use the idea of mathematical set, functions
and topological properties to make the theory more conspicuous. In the key point of idea, we
include how this theory can play the effective role to highlight new fixed point results and their
applications in different fields of Economics.
Keywords: brouwer’s fixed point theorem, equilibrium, concentration curve.
GJSFR-F Classification: MSC 2010: 47H10

OnSomeApplicationsofBrouwersFixedPointTheoreminEconomics

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and reference this article if parts of the article are reproduced in any manner. Applicable licensing terms are at https://
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Ref On Some Applications of Brouwer’s Fixed
Point Theorem in Economics

2021
Year
Md. Alamgir Hossain α, Md. Zulfikar Ali σ & Md. Asaduzzaman ρ
1. Kannan, R. (1968). Some results on fixed points. Bull. Cal. Math. Soc., 60, 71-76.

291
Abstract- In this paper, we discuss some major applications of Brouwer’s fixed point theorem in Economics. In the

Global Journal of Science Frontier Research ( F ) Volume XXI Issue V Version I

course of research work we mostly use the idea of mathematical set, functions and topological properties to make the
theory more conspicuous. In the key point of idea, we include how this theory can play the effective role to highlight new
fixed point results and their applications in different fields of Economics.
Keywords: brouwer’s fixed point theorem, equilibrium, concentration curve.

I. Introduction
Fixed point theory has its own importance and developed tremendously for the
last one and half century. In the last 50 years, fixed point theory has been an affluent
field of research for many mathematicians. In the 19𝑡𝑡ℎ century, the study of fixed point
theory was initiated by Poincare (1886) and in 20𝑡𝑡ℎ century developed by many
mathematicians like Brouwer, Banach, Kakutani, and others. Brouwer came up with
fixed point theorem to solve the equation 𝑓𝑓(𝑥𝑥) = 𝑥𝑥 in 1912. He also proved fixed point
theorem for a square, a sphere and their 𝑛𝑛 − 𝑑𝑑𝑑𝑑𝑑𝑑𝑑𝑑𝑑𝑑𝑑𝑑𝑑𝑑𝑑𝑑𝑑𝑑𝑑𝑑𝑑𝑑 counter parts which was
further extended by Kakutani. One of the fundamental principle of functional analysis,
namely- Banach Principle was introduced as well. Banach, in 1922 put forward the
proof that a contraction mapping in the field of a complete metric space offers a unique
fixed point. It was backed up by Kannan [1]. In 1930, Schauder has given the first fixed
point theorem in infinite dimensional spaces.
During the first decade of last century, the eminent Dutch Mathematicians L. E.
J. Brouwer (1912, see [2]) exhibited a basic mathematical theorem that has seen an
exceptional variety of important uses in both pure and applied mathematics. In
advanced mathematical analysis, fixed point theory is one of the most potential tools.
The theorem that concerns the properties and existence of fixed points are called fixed
point theorem. Informally speaking, fixed point theory is a branch of mathematics that
attempts to identify all self-maps (or self-correspondence) under which at least one
element is left invariant. In mathematics, a fixed point of a function is an element of
the function’s domain that is mapped to itself by the function. Shortly, if
𝑝𝑝 is a fixed pointof 𝑓𝑓(𝑥𝑥)

Author α σ: Department of Mathematics, University of Rajshahi, Rajshahi-6205, Bangladesh. e-mails: alamgir91rumath@gmail.com,

alimath1964@gmail.com
Author ρ: Department of Mathematics, Islamic University, Kushtia-7003, Bangladesh.
e-mail: masad_iu_math@yahoo.com

© 2021 Global Journals

 On Some Applications of Brouwer’s Fixed Point Theorem in Economics

then 𝑓𝑓(𝑝𝑝) = 𝑝𝑝.

The Figure 1.1 shows the existence of three fixed points between the intersection
of the function 𝑓𝑓(𝑥𝑥) and 𝑦𝑦 = 𝑥𝑥.

Notes
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301
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Figure 1.1: Representation of the function 𝑓𝑓 with three fixed points

Consider a function 𝑚𝑚 which is defined as 𝑚𝑚(𝑝𝑝) = 𝑛𝑛(𝑝𝑝) − 𝑝𝑝.Then if we want to
find-out the fixed point of the function 𝑛𝑛, then we make the solution as 𝑚𝑚(𝑝𝑝) = 0 (see
Figure 1.2), where 𝑓𝑓(𝑥𝑥) = 𝑛𝑛(𝑝𝑝)and𝑦𝑦 = 𝑝𝑝(𝑠𝑠𝑠𝑠𝑠𝑠)inFigure 1.1).

Figure 1.2: Fixed point of 𝑛𝑛 occurs when the solution is 𝑚𝑚(𝑝𝑝) = 0.

Fixed point theory has enormous applications in different fields like mathematics,
engineering, economics, game theory, image processing, artificial intelligence, population
dynamics, etc. In the field of economics, it is often used in the process of determining
the coincidence point of supply and demand functions. In game theory, fixed point
theory is very useful because by applying this theory we can find the existence of Nash
equilibrium for every finite strategic form game, for two-person zero sum games with

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 On Some Applications of Brouwer’s Fixed Point Theorem in Economics

finite strategy sets, etc. The main objective of this paper is to be introduced some real-
life applications of Brouwer’s fixed point theorem in Economics.
This article is prepared as follows: In Section 2, we discuss the basic concepts of
necessary preliminary notes, in Section 3, we describe with their mathematical
explanations about the applications of Brouwer’s Fixed Point Theorem in the required
fields of this research and in Section 4 conclusions are given.

II. Preliminary Notes

Ref
Throughout this paper, we shalluse the following preliminaries thins which are

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collected from the monographs of Border [3],Buxton [4], Cobzaş [5],Eilenberg [6] and

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Scarf [7].
Definition 2.1. Let 𝑋𝑋 ≠ ∅. A function 𝐹𝐹: 𝑋𝑋 → 𝑋𝑋 is called a self map on X. A point 𝑝𝑝 ∈ 311
𝑋𝑋is called a fixed point of a self-map 𝐹𝐹: 𝑋𝑋 → 𝑋𝑋, if 𝐹𝐹(𝑝𝑝) = 𝑝𝑝.

Global Journal of Science Frontier Research ( F ) Volume XXI Issue V Version I

Definition 2.2. (𝑋𝑋, 𝑑𝑑) be a metric space. A mapping 𝐹𝐹: 𝑋𝑋 → 𝑋𝑋is a contraction mapping
or contraction, if there exists a constant 𝑝𝑝, with 0 ≤ 𝑝𝑝 < 1, such that 𝑑𝑑�𝐹𝐹(𝑥𝑥), 𝐹𝐹(𝑦𝑦)� ≤
4. Buxton, C. (2016). Brouwer Fixed-Point Theorem.

𝑝𝑝𝑝𝑝(𝑥𝑥, 𝑦𝑦), for all 𝑥𝑥, 𝑦𝑦 ∈ 𝑋𝑋.

Again, for every 𝑥𝑥 ∈ 𝑋𝑋and any 𝑟𝑟 > 0, all points 𝑦𝑦 in the ball 𝐵𝐵𝑟𝑟 (𝑥𝑥), are mapped
into a ball𝐵𝐵𝑠𝑠 �𝐹𝐹(𝑥𝑥)�, with 𝑠𝑠 < 𝑟𝑟. This is shown in Figure 2.1 as:

Figure 2.1: 𝐹𝐹 is a contraction mapping

Example 2.1. Consider the map 𝑓𝑓(𝑥𝑥) = 𝑥𝑥/2 which maps (0,1] to itself. It is clearly a
𝑥𝑥
contraction. If 𝑓𝑓(𝑥𝑥) = 𝑥𝑥, then 𝑥𝑥 = 2 which implies 𝑥𝑥 = 0. Thus 𝑓𝑓 does not have a fixed
point in (0,1].
Theorem 2.1. (Brouwer Fixed Point Theorem in ℝ𝑛𝑛 ) [2,4]
In the late of 19th century, the idea about fixed point theory came into the
mathematical concentration. To give it the mathematical sense, the mathematician
Henri Poincare began using it in the topological analysis. Then in 1912 Brouwer first,
published his famous fixed point theorm for finite dimension.

© 2021 Global Journals

 On Some Applications of Brouwer’s Fixed Point Theorem in Economics

Figure 2.2: In this figure the left one is Poincare and the right one is Brouwer Ref
Statement of Brouwer Fixed Point Theorem: This theorem states that [2],if𝑋𝑋 ⊆ ℝ be 𝑛𝑛
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non-empty, compact, and convex set and if 𝑓𝑓: 𝑋𝑋 → 𝑋𝑋 be a function which is continuous,
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then 𝑓𝑓 has a fixed point, i.e., there exist an 𝑥𝑥 ∈ 𝑋𝑋 𝑠𝑠𝑠𝑠𝑠𝑠ℎ 𝑡𝑡ℎ𝑎𝑎𝑎𝑎𝑎𝑎(𝑥𝑥) = 𝑥𝑥.
321 The proof follows from [8].
Application of this theorem makes it possible to conclude, for example, a
Global Journal of Science Frontier Research ( F ) Volume XXI Issue V Version I

8. Vohra, R. V. (2004). Advanced mathematical economics. Routledge.

continuous function that maps from the interval [0,1] to [0,1].Then from the Figure 2.3
ensures that it has a fixed point.

Figure 2.3: Fixed point of the continuous function within interval [0, 1].
In Figure 2.4 is shown a function which is not continuous so within the interval
[𝑎𝑎, 𝑏𝑏] it does not have a fixed point.

Figure 2.4: Fixed point does not exist for a function which is not continuous on [𝑎𝑎, 𝑏𝑏].

© 2021 Global Journals

 On Some Applications of Brouwer’s Fixed Point Theorem in Economics

III. Applications of Brouwer’s Fixed Point Theorem in Different Fields of

Economics
Fixed point theorems are frequently used to test the convergence of market
equilibrium price in an economic model. The economic equilibrium exists only when
supply and demand are same for a given price.
a) Application 1 (Convergence Test of Market Equilibrium Price)
Notes Suppose 𝑃𝑃 and 𝑄𝑄 denotes the price and the quantity respectively. Again,
suppose 𝑃𝑃 = 𝐷𝐷(𝑄𝑄) and 𝑃𝑃 = 𝑆𝑆(𝑄𝑄) denotes the demand function and supply function

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respectively. Now, [𝑄𝑄 ∗ , 𝑃𝑃∗ ] denotes the market equilibrium that occurs only when
𝑠𝑠𝑠𝑠𝑠𝑠𝑠𝑠𝑠𝑠𝑠𝑠 = 𝑑𝑑𝑑𝑑𝑑𝑑𝑑𝑑𝑑𝑑𝑑𝑑 for a given price of a commodity ( 𝑊𝑊ℎ𝑒𝑒𝑒𝑒𝑒𝑒 𝑄𝑄 ∗ 𝑎𝑎𝑎𝑎𝑎𝑎 𝑃𝑃∗ represents the

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equilibrium quantity and the equilibrium price respectively, see Figure 3.1). Now, due
to effects of competition, market price differs from equilibrium price. So when price 331
converges to the equilibrium price in that case a market is considered as stable.

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Figure 3.1: The Equilibrium
Consider, 𝑃𝑃𝑚𝑚𝑚𝑚𝑚𝑚 𝑎𝑎𝑎𝑎𝑎𝑎 𝑃𝑃𝑚𝑚𝑚𝑚𝑚𝑚 denotes the price for a commodity in a given market
which is regarded as the lowest and highest price respectively. According to the
following function

𝑓𝑓: [𝑃𝑃𝑚𝑚𝑚𝑚𝑚𝑚 , 𝑃𝑃𝑚𝑚𝑚𝑚𝑚𝑚 ] → [𝑃𝑃𝑚𝑚𝑚𝑚𝑚𝑚 , 𝑃𝑃𝑚𝑚𝑚𝑚𝑚𝑚 ]

defined with:
𝑓𝑓(𝑝𝑝0 ) = 𝐷𝐷�𝑆𝑆 −1 (𝑃𝑃0 )�,

Function 𝑓𝑓 is adequately defined for a given price domain because the monotony
of demand and supply function permits for the existence of suitable inverse functions.
Then, it is very easy to show that function 𝑓𝑓 is continuous. Now, we can be terminated
it in such a way that fixed point (𝑝𝑝𝑝𝑝𝑝𝑝𝑝𝑝𝑝𝑝) exists on the basis of Brouwer’s fixed point
theorem, since the domain[𝑃𝑃𝑚𝑚𝑚𝑚𝑚𝑚 , 𝑃𝑃𝑚𝑚𝑚𝑚𝑚𝑚 ]is compact and convex.
In case of determining the equilibrium price, let us narrate the process which we
used. Put, 𝑃𝑃0 < 𝑃𝑃∗ , this indicates the meaning that the equilibrium price is greater than

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 On Some Applications of Brouwer’s Fixed Point Theorem in Economics

the market price. Again for the price 𝑃𝑃0 , 𝑎𝑎𝑎𝑎𝑎𝑎𝑎𝑎𝑎𝑎𝑎𝑎 𝑄𝑄𝑆𝑆0 𝑎𝑎𝑎𝑎𝑎𝑎 𝑄𝑄𝐷𝐷0 denotes the supply and
demand quantity respectively. The following is true then:

𝑄𝑄𝐷𝐷0 = 𝐷𝐷 −1 (𝑃𝑃0 ) 𝑎𝑎𝑎𝑎𝑎𝑎𝑄𝑄𝑆𝑆0 = 𝑆𝑆 −1 (𝑃𝑃0 )

Since, 𝐷𝐷 𝑎𝑎𝑎𝑎𝑎𝑎 𝑆𝑆 represents the monotonic decreasing and monotonic increasing

functions, then their inverse function 𝐷𝐷 −1 and 𝑆𝑆 −1 exists. When producers raise the price
to 𝑃𝑃1 (in case of a demand quantity) then the following is true:
Notes
𝑃𝑃1 = 𝐷𝐷(𝑄𝑄𝑆𝑆0 ) = 𝐷𝐷(𝑆𝑆 −1
(𝑃𝑃0 )),
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and 𝑃𝑃1 > 𝑃𝑃∗ . This is what we have for respective demand and supply quantities 𝑄𝑄𝐷𝐷1 and
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𝑄𝑄𝑆𝑆1 :
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𝑄𝑄𝐷𝐷1 > 𝑄𝑄𝑆𝑆1 ,
Global Journal of Science Frontier Research ( F ) Volume XXI Issue V Version I

which leads to deviation of ∣ 𝑄𝑄𝑆𝑆1 − 𝑄𝑄𝐷𝐷1 ∣. Now, if producers decrement the price to 𝑃𝑃2 so
that:
𝑃𝑃2 = 𝐷𝐷(𝑄𝑄𝑆𝑆1 ) = 𝐷𝐷(𝑆𝑆 −1 (𝑃𝑃1 )),

again, for the supply and demand quantities 𝑄𝑄𝐷𝐷2 and 𝑄𝑄𝑆𝑆2 :

𝑄𝑄𝐷𝐷2 > 𝑄𝑄𝑆𝑆2 ,

which leads to deviation of ∣𝑄𝑄𝑆𝑆2 − 𝑄𝑄𝐷𝐷2 ∣. If producers decrement the price to 𝑃𝑃3 so that:

𝑃𝑃3 = 𝐷𝐷(𝑄𝑄𝑆𝑆2 ) = 𝐷𝐷(𝑆𝑆 −1 (𝑃𝑃2 )).

By repeating this process in this way, the required sequence of the prices we get
𝑃𝑃0 , 𝑃𝑃1 , 𝑃𝑃2 , 𝑃𝑃3 , … … , 𝑃𝑃𝑚𝑚 , … … 𝑟𝑟𝑟𝑟𝑟𝑟𝑟𝑟𝑟𝑟𝑟𝑟𝑟𝑟𝑟𝑟𝑟𝑟𝑟𝑟𝑟𝑟𝑟𝑟 for which:

𝑃𝑃𝑚𝑚 = 𝐷𝐷�𝑆𝑆 −1 (𝑃𝑃𝑚𝑚 −1 )�, 𝑚𝑚 = 1,2,3, … ….

According to that the sequence of the prices (𝑃𝑃𝑚𝑚 ) converges to the equilibrium
price 𝑃𝑃∗ . This is presented in Figure 3.1. This application has also taken by Meznik[9].
b) Application 2 (Cournot Oligopoly)
Cournot Oligopoly [10] model is such a model for which the following assumption
satisfies:
1. The number of firms (𝑚𝑚) is finite
2. A firm 𝑖𝑖 is able to produce commodity 𝑖𝑖 for 𝑖𝑖 ∈ {1,2, … . 𝑚𝑚} ((𝑃𝑃𝑖𝑖 ) and (𝑄𝑄𝑖𝑖 ≥ 0) denote
the price and the quantity of commodities respectively)
3. All commodities are accurately divisible;
4. The aim of each firm is to select an amount of product that can be able to maximize
its own gain given the levels of the production selected by other firms.
Suppose, 𝑄𝑄−𝑖𝑖 = (𝑄𝑄1 , 𝑄𝑄2 , … … , 𝑄𝑄𝑖𝑖−1 , 𝑄𝑄𝑖𝑖+1 , … … 𝑄𝑄𝑚𝑚 ) be the quantities which is
regarded as vector quantities produced by the other firms. We may consider that:
𝑃𝑃𝑖𝑖 = 𝑝𝑝𝑖𝑖 (𝑄𝑄𝑖𝑖 , … … , 𝑄𝑄𝑖𝑖−1 ) = 𝑢𝑢𝑖𝑖 − 𝑣𝑣𝑖𝑖 𝑄𝑄𝑖𝑖 + ∑𝑗𝑗 ≠𝑖𝑖 𝑑𝑑𝑖𝑖𝑖𝑖 𝑄𝑄𝑗𝑗 , 𝑖𝑖 = 1,2, … , 𝑚𝑚

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 On Some Applications of Brouwer’s Fixed Point Theorem in Economics

Where price 𝑃𝑃𝑖𝑖 is decrementing in its quantity 𝑄𝑄𝑖𝑖 and, because of fulfilling
between the commodities, is considered to be incrementing in the quantities 𝑄𝑄𝑗𝑗 , 𝑗𝑗 ≠ 𝑖𝑖, of
the other firms (the parameters 𝑢𝑢𝑖𝑖 , 𝑣𝑣𝑖𝑖 𝑎𝑎𝑎𝑎𝑎𝑎 𝑑𝑑𝑖𝑖𝑖𝑖 are taken as positive).
Each firm for 𝑖𝑖 ∈ {1,2, … . 𝑚𝑚} has a function (known as cost function) which is
linear written as
𝐶𝐶𝑖𝑖 (𝑄𝑄𝑖𝑖 ) = 𝑐𝑐𝑖𝑖 𝑄𝑄𝑖𝑖
Notes with 𝑢𝑢𝑖𝑖 > 𝑐𝑐𝑖𝑖 > 0. The profit 𝛼𝛼𝑖𝑖 of firm 𝑖𝑖 ∈ {1,2, … . 𝑚𝑚}is:

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𝛼𝛼𝑖𝑖 (𝑄𝑄𝑖𝑖 , 𝑄𝑄−𝑖𝑖 ) = 𝑄𝑄𝑖𝑖 𝑝𝑝𝑖𝑖 (𝑄𝑄𝑖𝑖 , 𝑄𝑄−𝑖𝑖 ) − 𝑐𝑐𝑖𝑖 𝑄𝑄𝑖𝑖 .

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For each firm 𝑖𝑖 ∈ {1,2, … . 𝑚𝑚} satisfies, if (𝑄𝑄1∗ , 𝑄𝑄2∗ , … . , 𝑄𝑄𝑚𝑚
∗
) ∈ ℝ𝑛𝑛+ is a tuple of
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Cournot-Nash equilibrium:

Global Journal of Science Frontier Research ( F ) Volume XXI Issue V Version I

𝛼𝛼𝑖𝑖 (𝑄𝑄𝑖𝑖∗ , 𝑄𝑄−𝑖𝑖
∗ ∗
) ≥ 𝛼𝛼𝑖𝑖 (𝑄𝑄𝑖𝑖 , 𝑄𝑄−𝑖𝑖 )

for all 𝑄𝑄𝑖𝑖 ∈ ℝ+. This equilibrium exists if 2𝑣𝑣𝑖𝑖 > ∑𝑗𝑗 ≠𝑖𝑖 𝑑𝑑𝑖𝑖𝑖𝑖 for each firm 𝑖𝑖 ∈ {1,2, … . 𝑚𝑚}.
When the only comment is such that all goods are exactly divisible is not
satisfied, in such case the discrete Cournot-Nash equilibrium is explored. The goods
that are produced and sold in integer quantities; they are, mobile phones, books, etc.
Besides, numerous divisible goods, such as mangoes, vegetables, bananas etc. are sold in
discrete quantities.
For each firm 𝑖𝑖 ∈ {1,2, … . 𝑚𝑚} satisfies, if (𝑄𝑄1∗ , 𝑄𝑄2∗ , … … 𝑄𝑄𝑚𝑚 ∗
) ∈ ℤ𝑚𝑚
+ is a tuple of
discrete Cournot-Nash equilibrium:

𝛼𝛼𝑖𝑖 (𝑄𝑄𝑖𝑖∗ , 𝑄𝑄−𝑖𝑖

∗ ∗
) ≥ 𝛼𝛼𝑖𝑖 (𝑄𝑄𝑖𝑖 , 𝑄𝑄−𝑖𝑖 )
for all 𝑄𝑄𝑖𝑖 ∈ ℤ+.
A firm 𝑖𝑖 ∈ {1,2, … . 𝑚𝑚} may maximize its gain 𝛼𝛼𝑖𝑖 (𝑄𝑄𝑖𝑖 , 𝑄𝑄−𝑖𝑖 ) of its quantity which is
regarded as optimal integer given by the retraction function:

𝑢𝑢𝑖𝑖 − 𝑐𝑐𝑖𝑖 𝑑𝑑𝑖𝑖𝑖𝑖

𝑟𝑟𝑖𝑖 (𝑄𝑄−𝑖𝑖 ) = [ +� 𝑄𝑄 ]
2𝑣𝑣𝑖𝑖 2𝑣𝑣𝑖𝑖 𝑗𝑗
𝑗𝑗 ≠𝑖𝑖

Retraction function helps in explaining the quantity choice of the firms to how
one firm reacts to the quantity choice of the other firm. In this case, here we use the
symbol [ℎ] 𝑤𝑤ℎ𝑖𝑖𝑖𝑖ℎ 𝑚𝑚𝑚𝑚𝑚𝑚𝑚𝑚𝑚𝑚 𝑡𝑡ℎ𝑒𝑒 𝑔𝑔𝑔𝑔𝑔𝑔𝑔𝑔𝑔𝑔𝑔𝑔𝑔𝑔𝑔𝑔 𝑛𝑛𝑛𝑛𝑛𝑛𝑛𝑛𝑛𝑛𝑛𝑛𝑛𝑛 𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖𝑖 𝑡𝑡𝑡𝑡 ℎ 𝑎𝑎𝑎𝑎𝑎𝑎 𝑓𝑓𝑓𝑓𝑓𝑓 𝑡𝑡ℎ𝑒𝑒 𝑣𝑣𝑣𝑣𝑣𝑣𝑣𝑣𝑣𝑣𝑣𝑣 𝑜𝑜𝑜𝑜 𝑖𝑖 ∈
{1,2, … . 𝑚𝑚} satisfies 𝑟𝑟𝑖𝑖 (𝑄𝑄−𝑖𝑖 ) ≥ 0 for every 𝑄𝑄 ∈ ℤ𝑚𝑚 + (𝑏𝑏𝑏𝑏𝑏𝑏𝑏𝑏𝑏𝑏𝑏𝑏𝑏𝑏 𝑢𝑢𝑖𝑖 > 𝑐𝑐𝑖𝑖 > 0).
𝑚𝑚 𝑚𝑚
Define the function 𝐹𝐹: ℤ+ → ℤ by

𝐹𝐹𝑖𝑖 (𝑄𝑄𝑖𝑖 , 𝑄𝑄−𝑖𝑖 ) = 𝑟𝑟𝑖𝑖 (𝑄𝑄−𝑖𝑖 ) − 𝑄𝑄𝑖𝑖 , 𝑖𝑖 = 1,2,3, … . , 𝑚𝑚.

A discrete zero point of 𝐹𝐹 is a discrete Cournot-Nash equilibrium. Then clearly,
if 2𝑣𝑣𝑖𝑖 > ∑𝑗𝑗 ≠𝑖𝑖 𝑑𝑑𝑖𝑖𝑖𝑖 , 𝑖𝑖 = 1,2,3, … . , 𝑚𝑚, Brouwer’s fixed point theorem can show that function
𝐹𝐹 will have a discrete zero point. Thus, the final assumption shows that the Cournot
oligopoly model in such cases will have a discrete Cournot-Nash equilibrium
when 2𝑣𝑣𝑖𝑖 > ∑𝑗𝑗 ≠𝑖𝑖 𝑑𝑑𝑖𝑖𝑖𝑖 , 𝑖𝑖 = 1,2,3, … . , 𝑚𝑚.

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 On Some Applications of Brouwer’s Fixed Point Theorem in Economics

c) Application 3 (Concentration curve, [11])

Concentration curve has been popular with researchers for seeing market
concentration and finding the strength of market inequality. The process in order to
draw concentration curve are the determination of competitor ranking in terms of
market share (little to high), cumulative competitor market share and filling the dot
points created in the process. In this way newly drawn concentration curve is compared
to the curve that represents equal market shares (450 𝑙𝑙𝑙𝑙𝑙𝑙𝑙𝑙) in the imagined fixing
(Figure 3.2) to the faithful competition. Notes
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Figure 3.2: Representation of concentration curve

Thus in actual sense, concentration curve represents the graph of function 𝑓𝑓
which is continuous and maps from closed interval [0,1] to the closed interval [0,1]. The
assumption of Brouwer’s fixed point theorem satisfying, a fixed point automatically
exists for this mapping. This fixed point is not unique to be more precise, since from
Figure3.2 can be observed that both points 0 𝑎𝑎𝑎𝑎𝑎𝑎 1 are fixed points. Gini coefficient
must be equal to zero in case of the perfectly equally share market strength. As for the
whole domain of function 𝑓𝑓(𝑥𝑥) = 𝑥𝑥 would be true and an ambiguous number of fixed
points would exist for this function. Such an extreme condition is hardly found
empirically should also be taken into consideration. In the same way, to concentration
curve, Lorenz curve portraits the level of income to the household inequality. The curve
is adequately remote from the 450 line when income disagreement is large. The curve
will converge to the 450 line more if the inequality is less. In cases like perfect equality,
for example, concentration curve, perfect equality may result in Lorenz curve (It is
therefore, shows a graphical representation of the distribution of income or wealth) with
ambiguous number of fixed points. Therefore, it should be highlighted that such a result
is empirically rare.
IV. Conclusions
As analysis in fixed point theory has notably elongated in recent few years which
is actually tremendous in the field of both pure and applied mathematics. We have
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 On Some Applications of Brouwer’s Fixed Point Theorem in Economics

garnished this paper, in such a way that from start to finish it clarify the sense how
Brouwer’s fixed point theorem have been worked in different fields of economics with
their mathematical explanations. We have discussed the three applications (like as
convergence test of market equilibrium price, Cournot Oligopoly model and
concentration curve) of this theorem in the field of economics. Finally, it will be a great
source for the upcoming researchers to continue their research work smoothly in other
fields of economics by applying this theorem.
Notes Competing Interests
The authors declare that they have no any competing interests.

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Author’s Contributions

Year
All authors read and approved the final version of the manuscript.
References Références Referencias 371

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Global Journal of Science Frontier Research ( F ) Volume XXI Issue V Version I

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