Tikz Template

Tikz is a drawing language commonly used in LaTeX. The following contains a large number of templates for commonly used economic diagrams. You are welcome to use it. If you have developed some nice templates, I would be very happy to post it here if you are willing to share.

I have developed tools that allow user to generate simple diagram.
For windows: QuiteEasyDrawing.zip (Unzip the file and click exe to run it.). Further details at QED.
For windows/mac/linux:  CanvsFinal.zip (Download the file, unzip it, and run the Homepage.html)

Acknowledgement

Some graphics are created with financial support from NUS Education Enhancement Grant (TEG) under the project titled "I hear I forget, I see I remember, I draw I understand''---Development of Easily customizable templates for visual organizers and graphical illustrations. I would like to thank research assistant by Ren Yunfei and Zhang Jin (for generator), Zhan Mingjie, Cao Wanzhong and Zhang Jin (for templates).

Contents

  1. 1 Acknowledgement
  2. 2 Consumer Theory
    1. 2.1 Indifference Curves
    2. 2.2 Utility Maximization
    3. 2.3 Hicks Decomposition
    4. 2.4 Slutsky Decomposition
    5. 2.5 Engle Curve
    6. 2.6 Consumer Surplus
  3. 3 Theory of Production
    1. 3.1 Isoquant
    2. 3.2 Lerner-Hicks Diagram
    3. 3.3 Cost Minimization
    4. 3.4 Short-run Cost Curves
    5. 3.5 Long-run Cost Curves
    6. 3.6 Monopoly
    7. 3.7 Production Possibility Frontier
  4. 4 Demand and supply Analysis
    1. 4.1 Marshallian Demand and Supply
    2. 4.2 Textbook Demand and Supply
    3. 4.3 Cournot Cross Diagram
    4. 4.4 Harberger Triangle (Deadweight loss)
  5. 5 Labor Economics
    1. 5.1 Labor Supply Decision
    2. 5.2 Labor Supply Curve
    3. 5.3 Backward Bending Supply Curve
    4. 5.4 Labor Demand and Supply
    5. 5.5 Income distribution
  6. 6 Game Theory
    1. 6.1 Best Reply
    2. 6.2 Nash Equilibrium
    3. 6.3 Nash equilibrium with mixed strategies
    4. 6.4 Game Tree
      1. 6.4.1 Predation Game
      2. 6.4.2 Sequential Matching Pennies Game
      3. 6.4.3 Simultaneous Matching Pennies Game
      4. 6.4.4 Left-Right Game 
      5. 6.4.5 Niche Choice Game
      6. 6.4.6 Centipede Game
      7. 6.4.7 Game Tree with Incomplete Information
      8. 6.4.8 Signalling Game
    5. 6.5 Reaction Curves Dynamic Adjustment in Cournot Model
    6. 6.6 Strategic Complements
  7. 7 General Equilibirum
    1. 7.1 Edgeworth box
    2. 7.2 Contract Curve
    3. 7.3 Disequilibrium 
    4. 7.4 Price Taking Equilibrium
  8. 8 Public Economics
    1. 8.1 Laffer Curve
  9. 9 Macroeconomics
    1. 9.1 Samuelson's Circular Flow Model
    2. 9.2 Modern Circular Flow Model
    3. 9.3 AS-AD Diagram
    4. 9.4 Keynesian Cross
    5. 9.5 IS-LM
    6. 9.6 Solow Growth Model
    7. 9.7 Patinkin Diagram
    8. 9.8 Money Demand
    9. 9.9 Philips Curves
  10. 10 International Trade
    1. 10.1 Gains from trade
  11. 11 Industrial Organization
    1. 11.1 Production Differentiation
      1. 11.1.1 Hotelling Model
    2. 11.2 Network Effect
    3. 11.3 Insulating Traiff
    4. 11.4 Williamson Loss Triangle
  12. 12 Financial Economics
    1. 12.1 Asset Pricing
      1. 12.1.1 Markowitz Mean-Varinace Diagram
      2. 12.1.2 Garman Market Microsturcture
  13. 13 Others
    1. 13.1 Mathamatics
      1. 13.1.1 Three Different Curves
      2. 13.1.2 Unit Simplex 
      3. 13.1.3 Random Graph
      4. 13.1.4 Right Continuous
      5. 13.1.5 Left Continuous
      6. 13.1.6 Probability Tree
  14. 14 Export in PNG

Consumer Theory

Indifference Curves


\begin{figure}

\begin{tikzpicture}[scale=1.2]

% Axis

\draw [->] (0,0) node [below] {0} -- (0,0) -- (5.5,0) node [below] {Good 1};

\draw [->] (0,0) node [below] {0} -- (0,0) -- (0,5.5) node [above] {Good 2};

% Indifference curve

\draw (0.3,5) to [out=280,in=175] (5.5,0.5);

\draw (1,5) to [out=280,in=175] (5.5,1.2);

\draw (1.6,5) to [out=280,in=175] (5.5,1.8);

\end{tikzpicture}


\caption{An indifference map}

\end{figure}

Utility Maximization


\begin{tikzpicture}[scale=0.6]

\draw[thick,<->] (0,10) node[above]{$y$}--(0,0)--(10,0) node[right]{$x$};

\node [below left] at (0,0) {$0$};

\node [below] at (5,0) {$x^{*}$};

\node [left] at (0,5) {$y^{*}$};

\draw(1,9)--(9,1) node[right]{$p_xx+p_yy=I$};

\draw(0,5)--(5,5)--(5,0);

\draw(2,10) ..controls (3.33,6) and (6,3.33) .. (10,2) node[right]{$U(x,y)=U_0$};

\end{tikzpicture}

Hicks Decomposition


\begin{figure}

\begin{tikzpicture}[scale=1.2]

\draw [thick] (0,0) -- (8,0);

\draw [thick] (0,0) -- (0,5);

\node [right] at (8,0) {$x_1$};

\node [above] at (0,5) {$x_2$};

\draw [thick] (2.2,3.8) to [out=310,in=170] (5.5,1.8);

\draw [thick] (0.3,4.5) to [out=290,in=165] (3.1,1.6);

\node [right] at (6,1.1) {$C$};

\node [right] at (0.5,4.1) {$\texttt{I}$};

\draw [thick] (0,4.8) -- (7.5,0);

\draw [thick] (0,4.8) -- (2.7,0);

\draw[dashed](0.9,3.2)--(0.9,0);

\draw[dashed](3.4,2.6)--(3.4,0);

\draw [thick] (0,3.3) -- (5.3,0);

\draw[dashed](2.2,1.9)--(2.2,0);

\node [above] at (2.4,1.9) {$x^B$};

\draw[fill] (2.22,1.9) circle [radius =0.06];

\node [above] at (3,1.7) {$\texttt{I}$};

\node [right] at (0.8,3.5) {$x^A$};

\draw[fill] (0.9,3.25) circle [radius =0.06];

\node [right] at (3.4,2.8) {$x^C$};

\draw[fill] (3.43,2.6) circle [radius =0.06];

\node [right] at (0.5,4.6) {$C$};

\node [right] at (-0.1,4.2) {$A$};

\node [left] at (2.6,0.2) {$A$};

\node [right] at (5.3,0.2) {$B$};

\node [right] at (-0.1,3.5) {$B$};

\draw [decorate,decoration={brace,amplitude=4pt, mirror},xshift=0pt,yshift=-3pt]

(.9,0) -- (2.2,0) node [black,midway,yshift=-.5cm] {\footnotesize $SE_1$};

\draw [decorate,decoration={brace,amplitude=4pt, mirror},xshift=0pt,yshift=-3pt]

(2.2,0) -- (3.4,0) node [black,midway,yshift=-.5cm] {\footnotesize $IE_1$};

\end{tikzpicture}

\caption{Hicks decomposition}

\end{figure}

Slutsky Decomposition


\begin{figure}

\begin{tikzpicture}[scale=1.2]

\draw [thick] (0,0) -- (8,0);

\draw [thick] (0,0) -- (0,5);

\node [right] at (8,0) {$x_1$};

\node [above] at (0,5) {$x_2$};

\draw [thick] (1.7,4.2) to [out=310,in=160] (5.4,1.5);

\draw [thick] (0.6,4) to [out=295,in=165] (3.5,1);

\draw [thick] (1.4,3.2) to [out=290,in=155] (3.5,1.3);

\node [right] at (6.5,0.9) {$C$};

\draw [thick] (0,4.6) -- (7.5,0);

\draw [thick] (0,4.6) -- (3.15,0);

\draw[dashed](1.4,2.5)--(1.4,0);

\draw[dashed](3.4,2.5)--(3.4,0);

\draw [thick] (0,3.4) -- (5.4,0);

\draw[dashed](2.4,1.9)--(2.4,0);

\node [above] at (2.4,2) {$x^B$};

\draw[fill] (2.4,1.9) circle [radius =0.06];

\node [left] at (1.3,2.5) {$x^A$};

\draw[fill] (1.4,2.5) circle [radius =0.06];

\node [right] at (3.2,3) {$x^C$};

\draw[fill] (3.4,2.5) circle [radius =0.06];

\node [right] at (0.5,4.6) {$C$};

\node [right] at (-0.1,4) {$A$};

\node [left] at (2.9,0.2) {$A$};

\node [right] at (4.3,0.2) {$B$};

\node [right] at (-0.1,3.1) {$B$};

\draw [decorate,decoration={brace,amplitude=4pt, mirror},xshift=0pt,yshift=-3pt]

(1.4,0) -- (2.4,0) node [black,midway,yshift=-.5cm] {\footnotesize $SE_1$};

\draw [decorate,decoration={brace,amplitude=4pt, mirror},xshift=0pt,yshift=-3pt]

(2.4,0) -- (3.4,0) node [black,midway,yshift=-.5cm] {\footnotesize $IE_1$};

\end{tikzpicture}

\caption{Slutsky decomposition}

\end{figure}

Engle Curve


\begin{figure}

\begin{tikzpicture}[scale=1]

\draw [->] (0,0) node [below] {0} -- (0,0) -- (6.5,0);

\draw [->] (0,0) node [below] {0} -- (0,0) -- (0,5.5);

\node [align=left, left] at (-0.2,5.3) {Expenditure\\ on Good$(v_i)$};

\node [below] at (5.7,-0.1) {$Income(y)$};

\draw (0,0) to [out=15,in=255] (4.4,4.8);

\node [align=left, above] at (4.5,4.8) {luxury\\ $\eta_i>0$};

\draw (0.5,5) to [out=270,in=175] (4.8,0.7);

\node [align=left, above] at (5.4,0.4) {inferior\\ $\eta_i<0$};

\draw (0,0) to [out=40,in=185] (5,2);

\node [align=left, right] at (5,2) {necessity\\ $0<\eta_i<1$};

\draw (0,0)--(5,2.6);

\node [above] at (5,2.6) {$\eta_i=1$};

\end{tikzpicture}

\caption{Engel curves}

\end{figure}

Consumer Surplus


\begin{figure}

\begin{tikzpicture}[scale=1]

\draw [->] (0,0) node [below] {0} -- (0,0) -- (6,0) node [right] {$\texttt{Quantity}$};

\draw [->] (0,0) node [below] {0} -- (0,0) -- (0,5.5) node [above] {$\texttt{Price}$};

\draw (0,5)--(6,1.4);

\node [right] at (6,1.4) {$D$};

\draw (0,3.5)--(2.5,3.5);

\draw (0,2)--(5,2);

\draw (5,2)--(5,0);

\draw (2.5,0)--(2.5,3.5);

\node [right] at (5,2.2) {$B$};

\node [right] at (2.5,4) {$A$};

\node [right] at (.2,5.2) {$I$};

\node [left] at (0,1.5) {$P'$};

\node [left] at (0,3.5) {$P$};

\node [below] at (2.2,0) {$Q$};

\node [below] at (5,0) {$Q'$};

\end{tikzpicture}

\caption{The Marshallian measure of consumer surplus}

\end{figure}


Theory of Production

Isoquant


\begin{figure}

\begin{tikzpicture}[scale=1.2]

\draw (0,0) -- (5.5,0);

\draw (0,0) -- (0,5.5);

\node [left] at (-0.2,5.3) {$\texttt{K}$};

\node [below] at (5.3,-0.1) {$\texttt{L}$};

\draw [thick] (1.7,4.8) to [out=275,in=180] (5,1.3);

\node [right] at (1.5,5) {$I$};

\node [right] at (5,1.3) {$I$};

\draw [thick] (0,0) -- (2.7,4.5);

\draw [thick] (0,0) -- (4,3.7);

\draw[dotted, thick](1,4.05)--(4.1,0.95);

\draw[dotted, thick](1.15,5.1)--(3.35,0.8);

\node [right] at (0.7,4.4) {$C^1$};

\node [below] at (4.2,0.9) {$C^1$};

\node [above] at (1.1,5.2) {$C^2$};

\node [below] at (3.3,0.8) {$C^2$};

\node [right] at (2,3.4) {$B$};

\node [right] at (2.7,2.4) {$A$};

\end{tikzpicture}

\caption{The tangency points for a given isoquant and two budget lines}

\end{figure}

Lerner-Hicks Diagram


\begin{figure}

\begin{tikzpicture}[scale=1]

% Axis

\draw [thick](0,0) -- (5.5,0);

\draw [thick](0,0) -- (0,5.5);

\node [left] at (-0.2,5.3) {$p_a/p_b$};

\node [below] at (5.5,-0.2) {$A/B$};

%Curve

\draw [thick] (1.1,5) to [out=285,in=155] (4.7,0.7);

\end{tikzpicture}

\caption{Lerner-Hicks diagram relating relative factor prices to relative

factor intensities}

\end{figure}

Cost Minimization


\begin{figure}

\begin{tikzpicture}[scale=.9]

\draw (0,7.7) node [left] {$K$} -- (0,0) node [below left] {$0_1$} -- (8.2,0) node [below right] {$L$};

\node [left] at (0,6.1) {$C/r$};

\node [below] at (5.75,0) {$C/w$};

\node [below] at (2.9,0) {$L_1$};

\node [left] at (0,3) {$K_1$};

\node [right] at (6,1.4) {$x_1$};

\node [right] at (2.9,.9) {\tiny $|slope|=w/r$};

\draw [dotted, thick] (0,3) -- (2.9,3) -- (2.9,0);

\draw (1.5,6.4) to [out=-90, in=130] (2.9,3) to [out=-50, in=170] (6,1.4);

\draw (0,6.1) -- (5.75,0);

\end{tikzpicture}

\caption{Cost minimization}

\end{figure}


Short-run Cost Curves


\begin{figure}

\begin{tikzpicture}[scale=0.8]

\tiny

\draw (0,0) -- (8,0) node [below] {Quantity, units};

\draw (0,-0.5) -- (0,5) node [above] {Cost per unit, \$};

\draw (0.2,5) to [out=270,in=172] (2.6,0.4);

\draw (2.6,0.4) to [out=350.5,in=178] (7,0.1);

\node [right] at (7,0.5) {$AFC$};

\draw (0.3,5) to [out=280,in=150] (2,2.1);

\draw (2,2.1) to [out=330,in=200] (7,2);

\node [right] at (7,2.3) {$ATC$};

\draw (0,2) to [out=340,in=200] (7,1.8);

\node [right] at (7,1.8) {$AVC$};

\draw (0,2) to [out=315,in=240] (7,5);

\node [right] at (7,5) {$MC$};

\end{tikzpicture}

\caption{Short-run unit cost curves}

\end{figure}

Long-run Cost Curves


\begin{figure}

\begin{tikzpicture}[scale=0.8]

\tiny

\draw (-0.3,0)-- (0,0) -- (8,0) node [below] {Quantity, units};

\draw (0,-0.5)-- (0,0) -- (0,5) node [above] {Average total cost, \$};

\draw (0.2,3.7) to [out=290,in=180] (3.75,1);

\draw (3.75,1) to [out=360,in=260] (7.6,3.9);

\node [above] at (7.5,4) {$LRAC$};

\draw (0.5,3.3) to [out=280,in=180] (1.5,2.2);

\draw (1.5,2.2) to [out=360,in=255] (2.8,3.3);

\draw [fill] (0.75,2.65) circle [radius =0.06];

\node [below] at (0.75,2.55){$a$};

\node [left] at (2.8,3.3){$SRAC$};

\draw (2,2.6) to [out=280,in=180] (3.75,1);

\draw (3.75,1) to [out=360,in=255] (5.3,2.6);

\draw [fill] (3.75,1) circle [radius =0.06];

\node [below] at (3.75,1) {$b$};

\node [left] at (5.1,2) {$SRAC$};

\draw (4.8,3.4) to [out=280,in=180] (6,2.3);

\draw (6,2.3) to [out=360,in=270] (7.4,3.5);

\draw [fill] (7.32,3) circle [radius =0.06];

\node [below] at (7.32,3) {$c$};

\node [left] at (7.22,3.2) {$SRAC$};

\end{tikzpicture}

\caption{Long-run and short-run average cost curves}

\end{figure}

Monopoly


\begin{figure}

\begin{tikzpicture}[scale=1]

\draw (0,5.8) node [left] {$Y$} --(0,0) node [left] {$O$} --(4.8,0) node [right] {$X$};

\node [below] at (1.5,0) {$A$};

\node [below] at (2.4,0) {$B$};

\node [below] at (3.6,0) {$C$};


\node [left] at (0,2) {$H$};

\node [left] at (0,3) {$K$};

\node [right] at (1.5,1.5) {$E$};

\node [above left] at (0.8,3) {$F$};

\node [above] at (2.4,2) {$P$};

\node [above right] at (1.5,3) {$Q$};


%line M

\draw (1.53,0)--(1.53,4.8) node [above] {$M$} ;

% Line GEA

\draw (0,1.55)--(1.53,1.55)--(1.53,0);

\node [left] at (0,1.6) {$G$};


\draw (0,2)--(2.35,2)--(2.35,0);


\draw (0,3)--(3.6,3)--(3.6,0);

\draw (0,1) ..controls (2.3,1.6) and (4,3) ..(4.6,4.5) node [above right] {$S'$};

\draw (0,5.6) ..controls (0.8,3) and (1.5,1.5) ..(2.1,0.5) node [below] {$d'$};

\draw (0,5.6) ..controls (1.5,2.75) and (2.4,1.6) ..(4.4,0.4) node [above right] {$D'$};

\end{tikzpicture}

\caption {Monopoly}

\end{figure}


Production Possibility Frontier


\begin{figure}

\begin{tikzpicture}[scale=1.2]

\draw (0,5.1) node [left] {$Y$} -- (0,0) node [below left] {$0$} -- (4,0) node [below] {$X$};

\draw (0,4.1) to [out=-15, in=120] (2.8,2) to [out=-60, in=95] (3.4,0);

\draw [->] (2.8,2) -- (3.3,2.2);

\draw [dashed] (1.2,3.6) -- (3.1,1.3);

\draw [dashed] (1.2,3.6) -- (2.9,3.2);

\node [right] at (3.3,2.2) {$E$};

\node [right] at (3.1,1.3) {$B$};

\node [left] at (0,4.1) {$F$};

\draw [fill] (0,4.1) circle [radius=.05];

\node [right] at (0,4.5) {$H$};

\draw [fill] (0,4.5) circle [radius=.05];

\node [above left] at (3.4,0) {$G$};

\draw [fill] (3.4,0) circle [radius=.05];

\node [right] at (2.5,2.5) {$I$};

\draw [fill] (2.5,2.5) circle [radius=.05];

\node [above] at (2.9,2) {$D$};

\draw [fill] (2.8,2) circle [radius=.05];

\node [right] at (2.9,3.2) {$C$};

\draw [fill] (2.9,3.2) circle [radius=.05];

\node [above right] at (1.2,3.6) {$A$};

\draw [fill] (1.2,3.6) circle [radius=.05];


\end{tikzpicture}

\caption{The production possibilities curve}

\end{figure}


Demand and supply Analysis

Marshallian Demand and Supply


\begin{figure}

\begin{tikzpicture}[scale=1]

% Axis

\draw [thick] (0,0) node [below] {O} -- (0,0) -- (5.5,0) node [below] {q};

\draw [thick] (0,0) node [below] {O} -- (0,0) -- (0,5.5) node [right] {p};

\node [left] at (-0.2,5.3) {$\texttt{Price}$};

\node [right] at (5.7,0.1) {$\texttt{Quantity}$};

% Demand and Supply Curves

\draw plot [smooth] coordinates {(0,4.8) (1,4.45) (2,3.95) (3.3,3.1) (4,2.5) (5,1.5)};

\draw plot [smooth] coordinates {(0,2) (1,2.1) (2,2.4) (3.3,3.05) (4,3.6) (5,4.7)};

\node [left] at (0,2) {$S$};

\node [left] at (0,4.8) {$D$};

\node [right] at (5,1.5) {$D'$};

\node [right] at (5,4.7) {$S'$};

% Vertical lines

\draw [thick] (2,0) -- (2,3.95);

\draw [thick] (4,0) -- (4,3.6);

% Labels

\node [below] at (2,0) {$Q_1$};

\node [below] at (4,0) {$Q_2$};

\node [above] at (2,3.95) {$d_1$};

\node [above] at (4,3.6) {$s_2$};

\node [left] at (2,2.5) {$s_1$};

\node [right] at (4,2.5) {$d_2$};

\node [above] at (3.3,3.1) {$E$};

\end{tikzpicture}

\caption{Marshall's diagram}

\end{figure}

Textbook Demand and Supply


\begin{tikzpicture}[scale=0.6]

\draw[thick,<->] (0,10) node[above]{$P$}--(0,0)--(10,0) node[right]{$Q$};

\node [below left] at (0,0) {$0$};

\node [below] at (5,0) {$Q^*$};

\node [left] at (0,5) {$P^*$};

\draw(1,1)--(9,9) node[right]{$S$};

\draw(1,9)--(9,1) node[right]{$D$};

\draw[dashed](0,5)--(5,5)--(5,0);

\end{tikzpicture}

Cournot Cross Diagram


\begin{figure}

\begin{tikzpicture}[scale=1.1]

% Axis

\draw [thick] (-0.3,0) node [below] {O} (-0.5,0)-- (0,0) -- (5.5,0) node [right] {y};

\node [above] at (0,5.5) {[Price]};

\node [below] at (5.5,-0.2) {[Quantity]};

\draw [thick] (0,-0.5)-- (0,0) -- (0,5.5);

\node [left] at (0,5.3) {p};


%Downward slopping line

\node [above] at (0.5,5) {N};

\draw [thick] (0.5,5) to [out=280,in=140] (4.5,0);

\node [above] at (4.5,0.2) {$M$};


% Upward Slopping PQ

\draw [thick] (0.3,0.5) to [out=38,in=232] (3.8,4);

\node [left] at (0.43,0.5) {$P$};

\node [right] at (3.8,4) {$Q$};


% Upward Slopping P'Q'

\draw [thick] (0.3,1.5) to [out=38,in=232] (3.5,4.7);

\node [left] at (0.45,1.5) {$P'$};

\node [right] at (3.5,4.8) {$Q'$};


% dashed lines

\draw [dashed] (0,2.6)--(1.6,2.6);

\node [right] at (1.7,2.6) {$S'$};

\draw [dashed](1.6,1.55)--(1.6,2.6);

\node [below] at (1.6,1.55) {$\texttt{V}$};

\draw [dashed](0,2)--(2,2);

\node [right] at (2.25,2) {$S$};

\node [left] at (0,2) {$T$};

\node [left] at (0,2.6) {$T'$};


\end{tikzpicture}

\caption{Cournot's scissors diagram and tax incidence analysis}

\end{figure}

Harberger Triangle (Deadweight loss)


\begin{figure}

\begin{tikzpicture}[scale=1]

\draw [->] (0,0) node [below] {0} -- (0,0) -- (6,0) node [right] {$\texttt{Quantity}$};

\draw [->] (0,0) node [below] {0} -- (0,0) -- (0,5.5) node [above] {$\texttt{Price}$};

\draw (0,5)--(6,1.4);

\node [right] at (6,1.4) {$D$};

\draw (0,3.5)--(2.5,3.5);

\draw (0,2)--(5,2);

\draw (5,2)--(5,0);

\draw (2.5,0)--(2.5,3.5);

\node [right] at (5,2.2) {$B$};

\node [right] at (2.5,4) {$A$};

\node [right] at (.2,5.2) {$I$};

\node [left] at (0,1.5) {$P'$};

\node [left] at (0,3.5) {$P$};

\node [below] at (2.2,0) {$Q$};

\node [below] at (5,0) {$Q'$};

\end{tikzpicture}

\caption{The Marshallian measure of consumer surplus}

\end{figure}

Labor Economics

Labor Supply Decision


\begin{figure}

\begin{tikzpicture}[scale=0.7]

\draw [<->] (0,10.4) node [above] {\small $Daily\ Income$} --(0,0) node [left] {$O$} --(9,0);

\node [below] at (8.6, -0.6) {\small $House\ of\ Leisure$};

\node [left] at (0,3.2) {$A$};

\node [left] at (0,5.9) {$B$};

\node [left] at (0,9.1) {$C$};

\node [below] at (8.6,0) {$D$};

\node [below] at (6.4,0.8) {$a$};

\node [above] at (5.5,2.2) {$b$};

\node [right] at (6.4,2.4) {$c$};


% Slope OW

\draw (0,3.2)--(8.6,0);

\draw (0,5.9)--(8.6,0);

\draw (0,9.1)--(8.6,0);


\draw [->] (0.75,2) node [below] {\footnotesize$Slope = OW_1$}--(0.8,2.7);

\draw [->] (0.75,4.5) node [below] {\footnotesize$Slope = OW^*$} --(0.8,5.3);

\draw [->] (0.75,7.2) node [below] {\footnotesize$Slope = OW_2$} --(0.8,8.1);


% ICs

\draw (1.3,8.7) node [above] {\footnotesize$IC_1$} ..controls (2.6,2.4) and (6,0.1) ..(8.3,0.7);

\draw (2.2,8.5) node [right] {\footnotesize$IC_2$} ..controls (3.8,3.2) and (5.2,1.8) ..(6.8,1.7);

\draw (3.2,8.3) node [right] {\footnotesize$IC_3$} ..controls (4.7,3.7) and (6.4,2.1) ..(7.3,1.8);

\end{tikzpicture}

\caption {The individual labour supply decision}

\end{figure}

Labor Supply Curve


\begin{figure}

\begin{tikzpicture}[scale=0.7]

\draw [<->] (0,10.2) node [above] {\small $Real\ Wage\ Rate$} --(0,0) node [below left] {$O$}--(9.5,0) node [below left] {\small $House\ of\ Work$};

\node [left] at (0,3.4) {$W_1$};

\node [left] at (0,5.6) {$W_*$};

\node [left] at (0,7.6) {$W_2$};

\node [right] at (7.3,3.4) {$a$};

\node [right] at (8.2,5.6) {$b$};

\node [right] at (7.5,7.6) {$c$};

\draw [dashed] (0,3.4)--(7.3,3.4);

\draw [dashed] (0,5.6)--(8.2,5.6);

\draw [dashed] (0,7.6)--(7.4,7.6);

\draw (3.8,1.7) node [below] {$S_L$} to [out=20, in=-90] (8.2,5.6) to [out=90, in=-20] (4.3,9.2) node [below left] {$S_L$};


\end{tikzpicture}

\caption {The individual supply curve}

\end{figure}

Backward Bending Supply Curve


\begin{figure}

\begin{tikzpicture}[scale=0.8]

\draw [<->] (0,8.3) node [above] {\small $Real \ Wage \ Rate$} --(0,0) node [below] {$O$}--(7.6,0) node [below] {\small $Hours \ of \ Work$};

\node [left] at (0,4.7){$W_*$};

\draw (6,8.2)node [below] {$S_L$} to [out=-165, in=90] (2.4, 4.7) to [out=-90, in=180] (6.6,2) node [below] {$S_L$};


\end{tikzpicture}

\caption{Backward-bending labour supply curve (conservative version)}

\end{figure}


Labor Demand and Supply



\begin{figure}

\begin{tikzpicture}[scale=0.8]

\draw (0,0) -- (6,0) node [right] {$L$};

\draw (0,0) -- (0,6) node [left] {$P_L$};

\node at (-0.5,-0.5) {O};

\draw (0,3)--(5.5,3);

\node at (5.9,3) {$s_L$};

\node at (-0.5,3) {$w$};

\draw (0,5.7)--(5.6,1);

\node at (6.8,0.8) {$D_L=MP_L$};

\draw[dashed](3.2,0)--(3.2,3.1);

\node at (3.2,-0.5) {$L^{*}$};

\end{tikzpicture}

\caption{Labor demand and supply}

\end{figure}


Income distribution



\begin{figure}

\begin{tikzpicture}[scale=0.8]

\tiny

\draw (0,0) -- (6,0) node [right] {$L$};

\draw (0,0) -- (0,6) node [left] {$P_L$};

\node at (-0.3,-0.3) {O};

\draw (0,3)--(6,3);

\node at (6.2,3) {$S_L$};

\node at (-0.5,3) {$W$};

\draw (0,5.4)--(5.6,1.27);

\node at (3.4,3.4) {$A$};

\node at (6.4,0.8) {$MP_L$};

\draw[dashed](3.2,0)--(3.2,3.85);

\node at (-0.5,3.85) {$C$};

\node at (3.2,4.3) {$B$};

\draw[dashed](0,3.85)--(3.2,3.85);

\node at (3.2,-0.5) {$L_0$};

\draw (0,5.4)--(5.5,2.8);

\node at (5.8,2.5) {$AP_L$};

\end{tikzpicture}

\caption{Income distribution}

\end{figure}


Game Theory

Best Reply


\begin{figure}

\begin{tikzpicture}[scale=0.7]

\tiny

\draw (0,0) -- (6,0) node [below] {$s_B$};

\draw (0,0) -- (0,6) node [left] {$s_A$};

\node [below] at (0,0) {$O$};

\draw(0,0.7) to [out=15,in=230] (5.5,4);

\node [below] at (5.4,3.3) {$R_A(s_B)$};

\draw [->] (3,0.5) -- (3,1.4);

\draw [xshift=7cm](0,0) -- (6,0) node [below] {$s_B$};

\draw [xshift=7cm] (0,0) -- (0,6) node [left] {$s_A$};

\node [xshift=4.7cm][below] at (0,0) {$O$};

\draw [xshift=7cm] (1,0) to [out=40,in=260] (3.5,3);

\draw [xshift=7cm] (3.5,3) to [out=85,in=220] (5.5,5);

\node [xshift=6cm][below] at (4.6,4.4) {$R_B(s_A)$};

\draw [xshift=7cm][->] (0.5,2.5) -- (2,2.5);

\end{tikzpicture}

\caption{Best reply}

\end{figure}


Nash Equilibrium


\begin{figure}

\begin{tikzpicture}[scale=0.7]

\tiny

\draw (0,0) -- (6,0) node [below] {$s_B$};

\draw (0,0) -- (0,6) node [left] {$s_A$};

\node [below] at (0,0) {$O$};

\draw (0,0.7) to [out=15,in=230] (5.5,4.6);

\node [below] at (6,4) {$R_A(s_B)$};

\node [below] at (4,5) {$R_B(s_A)$};

\draw (1,0) to [out=40,in=260] (3.5,3);

\draw (3.5,3) to [out=85,in=220] (5.3,5.3);

\node [below] at (3.3,0) {$s^*_B$};

\draw[dotted](3.3,0)--(3.3,2.4);

\draw[dotted](0,2.4)--(3.3,2.4);

\node [left] at (0,2.4) {$s^*_A$};

\end{tikzpicture}

\caption{Nash equilibrium}

\end{figure}

Nash equilibrium with mixed strategies



\begin{figure}

\begin{tikzpicture}[scale=0.8]

\tiny

\tiny

\draw (0,0) -- (3.3,0);

\draw (0,0) -- (0,3.3);

\draw [thick] (0,0)--(1.5,0)--(1.5,3) -- (3,3);

\draw [dashed] (0,3)--(1.5,3);

\draw [dashed] (3,3)--(3,0);

\node [right] at (3,3) {$R_A(q_B)$};

\node [below] at (0,0) {$0$};

\node [below] at (1.5,0) {$1\over 2$};

\node [below] at (3,0) {$1$};

\node [right] at (3.3,0) {$q_B$};

\node [left] at (0,3) {$1$};

\node [above] at (0,3.3) {$q_A$};


\draw [xshift=5.1cm] (0,0) -- (3.3,0);

\draw [xshift=5.1cm] (0,0) -- (0,3.3);

\draw [xshift=5.1cm,thick] (3,0) -- (3,1.5)--(0,1.5)--(0,3);

\draw [xshift=5.1cm][dashed] (0,3)--(3,3);

\draw [xshift=5.1cm][dashed] (0,1.5)--(3,1.5);

\draw [xshift=5.1cm][dashed] (3,3)--(3,1.5);

\node [xshift=3.9cm][right] at (3.3,0.4) {$R_B(q_A)$};

\node [xshift=4.1cm][below] at (0,0) {$0$};

\node [xshift=4.1cm][left] at (0,1.5) {$1\over 2$};

\node [xshift=4.1cm][below] at (3,0) {$1$};

\node [xshift=4.1cm][right] at (3.3,0) {$q_B$};

\node [xshift=4.1cm][left] at (0,3) {$1$};

\node [xshift=4.1cm][above] at (0,3.3) {$q_A$};


\draw [xshift=10cm] (0,0) -- (3.3,0);

\draw [xshift=10cm] (0,0) -- (0,3.3);

\draw [xshift=10cm] (3,0) -- (3,1.5);

\draw [xshift=10cm,thick] (0,0)--(1.5,0)--(1.5,3) -- (3,3);

\draw [xshift=10cm,thick] (3,0) -- (3,1.5)--(0,1.5)--(0,3);

\draw [xshift=10cm][dashed] (0,3)--(3,3);

\draw [xshift=10cm][dashed] (0,1.5)--(3,1.5);

\draw [xshift=10cm][dashed] (3,3)--(3,1.5);

\node [xshift=8cm][right] at (3,3) {$R_A(q_B)$};

\node [xshift=8cm][right] at (3,1) {$R_B(q_A)$};

\node [xshift=8cm][below] at (0,0) {$0$};

\node [xshift=8cm][left] at (0.1,1.5) {$q^*_A$=$1\over 2$};

\node [xshift=8cm][below] at (3,0) {$1$};

\node [xshift=8cm][right] at (3.3,0) {$q_B$};

\node [xshift=8cm][left] at (0,3) {$1$};

\node [xshift=8cm][above] at (0,3.3) {$q_A$};

\draw [xshift=10cm] (1.5,0) -- (1.5,3);

\draw [xshift=10cm] (1.5,3) -- (3,3);

\node [xshift=8cm][below] at (1.5,0) {$q^*_B$=$1\over 2$};

\end{tikzpicture}

\caption{Nash equilibrium in mixed strategies}

\end{figure}


Game Tree

Predation Game


\begin{tikzpicture}[scale=1.5,font=\footnotesize]

\tikzset{

% Two node styles for game trees: solid and hollow

solid node/.style={circle,draw,inner sep=1.5,fill=black},

hollow node/.style={circle,draw,inner sep=1.5}

}

% Specify spacing for each level of the tree

\tikzstyle{level 1}=[level distance=10mm,sibling distance=25mm]

\tikzstyle{level 2}=[level distance=10mm,sibling distance=15mm]

\tikzstyle arrowstyle=[scale=1]

\tikzstyle directed=[postaction={decorate,decoration={markings,

mark=at position .5 with {\arrow[arrowstyle]{stealth}}}}]

% The Tree

\node(0)[solid node,label=above:{$Entrant$}]{}


child{node(1)[hollow node, label=below:{$(0,2)$}]{}

edge from parent node[left,xshift=-3]{$OUT$}

}

child{node(2)[solid node,label=right:{$Incumbent$}]{}

child{node[hollow node,label=below:{$(-3,-1)$}]{} edge from parent node[left]{$Fight$}}

child{node[hollow node,label=below:{$(1,1)$}]{} edge from parent [directed] node[right]{$Accomodate$}}

edge from parent[directed] node[right,xshift=3]{$IN$}

};


\end{tikzpicture}

Sequential Matching Pennies Game


\begin{tikzpicture}[scale=1.5,font=\footnotesize]

% Specify spacing for each level of the tree

\tikzstyle{level 1}=[level distance=15mm,sibling distance=25mm]

\tikzstyle{level 2}=[level distance=15mm,sibling distance=15mm]


\tikzset{

% Two node styles for game trees: solid and hollow

solid node/.style={circle,draw,inner sep=1.5,fill=black},

hollow node/.style={circle,draw,inner sep=1.5}

}


% The Tree

\node(0)[solid node,label=above:{$1$}]{}


child{node(1)[solid node,label=right:{$2$}]{}

child{node[hollow node,label=below:{$(-1,1)$}]{} edge from parent node[left]{$H$}}

child{node[hollow node,label=below:{$(1,-1)$}]{} edge from parent node[right]{$T$}}

edge from parent node[left,xshift=-3]{$H$}

}

child{node(2)[solid node,label=right:{$2$}]{}

child{node[hollow node,label=below:{$(1,-1)$}]{} edge from parent node[left]{$H$}}

child{node[hollow node,label=below:{$(-1,1)$}]{} edge from parent node[right]{$T$}}

edge from parent node[right,xshift=3]{$T$}

};


\end{tikzpicture}

Simultaneous Matching Pennies Game


\begin{tikzpicture}[scale=1.5,font=\footnotesize]

\tikzset{

% Two node styles for game trees: solid and hollow

solid node/.style={circle,draw,inner sep=1.5,fill=black},

hollow node/.style={circle,draw,inner sep=1.5}

}

% Specify spacing for each level of the tree

\tikzstyle{level 1}=[level distance=15mm,sibling distance=25mm]

\tikzstyle{level 2}=[level distance=15mm,sibling distance=15mm]

% The Tree

\node(0)[solid node,label=above:{$1$}]{}


%child[grow=right,level distance=30mm]{node[hollow node,label=right:{$(1,3)$}]{}

%edge from parent node[above]{$R$}

%}

child{node(1)[solid node]{}

child{node[hollow node,label=below:{$(-1,1)$}]{} edge from parent node[left]{$H$}}

child{node[hollow node,label=below:{$(1,-1)$}]{} edge from parent node[right]{$T$}}

edge from parent node[left,xshift=-3]{$H$}

}

child{node(2)[solid node]{}

child{node[hollow node,label=below:{$(1,-1)$}]{} edge from parent node[left]{$H$}}

child{node[hollow node,label=below:{$(-1,1)$}]{} edge from parent node[right]{$T$}}

edge from parent node[right,xshift=3]{$T$}

};

% information set

\draw[dashed,rounded corners=10]($(1) + (-.2,.25)$)rectangle($(2) +(.2,-.25)$);

% specify mover at 2nd information set

\node at ($(1)!.5!(2)$) {$2$};

\end{tikzpicture}

Left-Right Game 


\begin{figure}

\begin{tikzpicture}[scale=1]


\node [above] at (0.55, 1.1) {$left$};

\node [above] at (5.3, 1.1) {$left$};

\node [above] at (2.5, 2.2) {$left$};

\node [above] at (2.5, 1.1) {$right$};

\node [above] at (5.5, 2.1) {$right$};

\node [above] at (7.5, 1.1) {$right$};


\draw [fill] (1.3, 1.8) circle [radius=0.1] node [above] {$B$};

\draw [fill] (6.5, 1.8) circle [radius=0.1] node [above] {$B$};

\draw [fill = white] (3.9, 2.7) circle [radius=0.1] node [above] {$A$};

\draw (0, 0) node [below] {$(-1,-1)$}-- (1.3, 1.8) -- (3.83, 2.65);

\draw (3.96, 2.65) -- (6.5, 1.8) -- (7.8, 0) node [below] {$(-8,-8)$};

\draw (1.3, 1.8) -- (2.6, 0) node [below] {$(-10,0)$};

\draw (6.5, 1.8) -- (5.2, 0) node [below] {$(0,-10)$};


\end{tikzpicture}

\caption{Decision tree}

\end{figure}

Niche Choice Game


\begin{tikzpicture}[scale=1.5,font=\footnotesize]

\tikzset{

% Two node styles for game trees: solid and hollow

solid node/.style={circle,draw,inner sep=1.5,fill=black},

hollow node/.style={circle,draw,inner sep=1.5}

}

% Specify spacing for each level of the tree

\tikzstyle{level 1}=[level distance=10mm,sibling distance=25mm]

\tikzstyle{level 2}=[level distance=10mm,sibling distance=25mm]

\tikzstyle{level 3}=[level distance=15mm,sibling distance=15mm]

\tikzstyle arrowstyle=[scale=1]

\tikzstyle directed=[postaction={decorate,decoration={markings,

mark=at position .5 with {\arrow[arrowstyle]{stealth}}}}]

% The Tree

\node(0)[solid node,label=above:{$Entrant$}]{}


child{node(1)[hollow node, label=below:{$(0,2)$}]{}

edge from parent node[left,xshift=-3]{$OUT$}

}

child{node(2)[solid node,label=right:{$Entrant$}]{}

child{node(3)[solid node]{}

child{node[hollow node,label=below:{$(-6,-6)$}]{}edge from parent node[left]{$Small$} }

child{node[hollow node,label=below:{$(-1,1)$}]{} edge from parent node[right]{$Large$}}

edge from parent node[left]{$Small$}}

child{node(4)[solid node]{}

child{node[hollow node,label=below:{$(1,-1)$}]{}edge from parent node[left]{$Small$} }

child{node[hollow node,label=below:{$(-3,-3)$}]{} edge from parent node[right]{$Large$}}

edge from parent node[right]{$Large$}

}

edge from parent node[right,xshift=3]{$IN$}

};

% information set

\draw[dashed,rounded corners=10]($(3) + (-.2,.25)$)rectangle($(4) +(.2,-.25)$);

% specify mover at 2nd information set

\node at ($(3)!.5!(4)$) {$Incumbent$};

\end{tikzpicture}

Centipede Game


\begin{tikzpicture}[font=\footnotesize,scale=1]

% Two node styles: solid and hollow

\tikzstyle{solid node}=[circle,draw,inner sep=1.2,fill=black];

\tikzstyle{hollow node}=[circle,draw,inner sep=1.2];

% The Tree

\node(0)[hollow node]{}

child[grow=down]{node[solid node]{}edge from parent node[left]{$S$}}

child[grow=right]{node(1)[solid node]{}

child[grow=down]{node[solid node]{}edge from parent node[left]{$S$}}

child[grow=right]{node(2)[solid node]{}

child[grow=down]{node[solid node]{}edge from parent node[left]{$S$}}

child[grow=right]{node(3)[solid node]{}

child[grow=down]{node[solid node]{}edge from parent node[left]{$S$}}

child[grow=right]{node(4)[solid node]{}

child[grow=down]{node[solid node]{}edge from parent node[left]{$S$}}

child[grow=right]{node(5)[solid node]{}

child[grow=down]{node[solid node]{}edge from parent node[left]{$S$}}

child[grow=right]{node(6)[solid node]{}

edge from parent node[above]{$C$}

}

edge from parent node[above]{$C$}

}

edge from parent node[above]{$C$}

}

edge from parent node[above]{$C$}

}

edge from parent node[above]{$C$}

}

edge from parent node[above]{$C$}

};

% Movers

\foreach \x in {0,2,4}

\node[above]at(\x){1};

\foreach \x in {1,3,5}

\node[above]at(\x){2};

% payoffs

\node[below]at(0-1){$1,0$};

\node[below]at(1-1){$0,2$};

\node[below]at(2-1){$3,1$};

\node[below]at(3-1){$2,4$};

\node[below]at(4-1){$5,3$};

\node[below]at(5-1){$4,6$};

\node[right]at(6){$6,5$};

\end{tikzpicture}

Game Tree with Incomplete Information


\begin{tikzpicture}[scale=1.5,font=\footnotesize]

\tikzset{

% Two node styles for game trees: solid and hollow

solid node/.style={circle,draw,inner sep=1.5,fill=black},

hollow node/.style={circle,draw,inner sep=1.5}

}

% Specify spacing for each level of the tree

\tikzstyle{level 1}=[level distance=10mm,sibling distance=37mm]

\tikzstyle{level 2}=[level distance=10mm,sibling distance=20mm]

\tikzstyle{level 3}=[level distance=15mm,sibling distance=10mm]

\tikzstyle arrowstyle=[scale=1]

\tikzstyle directed=[postaction={decorate,decoration={markings,

mark=at position .5 with {\arrow[arrowstyle]{stealth}}}}]

% The Tree

\node(0)[solid node,label=above:{$1$}]{}

child{node(1)[solid node, label=left:{$2$}]{}

child{node(3)[solid node]{}

child{node[hollow node,label=below:{$(6,3)$}]{}edge from parent node[left]{$G$} }

child{node[hollow node,label=below:{$(1,4)$}]{} edge from parent node[right]{$H$}}

edge from parent node[left]{$C$}}

child{node(4)[solid node]{}

child{node[hollow node,label=below:{$(1,2)$}]{}edge from parent node[left]{$G$} }

child{node[hollow node,label=below:{$(3,2)$}]{} edge from parent node[right]{$H$}}

edge from parent node[right]{$D$}

}

edge from parent node[left,xshift=-3]{$A$}

}

child{node(2)[solid node,label=right:{$2$}]{}

child{node(6)[solid node,label=right:{$1$}]{}

child{node[hollow node,label=below:{$(2,3)$}]{}edge from parent node[left]{$I$} }

child{node[hollow node,label=below:{$(1,4)$}]{} edge from parent node[right]{$J$}}

edge from parent node[left]{$E$}}

child{node(7)[solid node,label=right:{$1$}]{}

child{node[hollow node,label=below:{$(2,3)$}]{}edge from parent node[left]{$K$} }

child{node[hollow node,label=below:{$(3,2)$}]{} edge from parent node[right]{$L$}}

edge from parent node[right]{$F$}

}

edge from parent node[right,xshift=3]{$B$}

};

% information set

\draw[dashed,rounded corners=10]($(3) + (-.2,.25)$)rectangle($(4) +(.2,-.25)$);

% specify mover at 2nd information set

\node at ($(3)!.5!(4)$) {$1$};

\end{tikzpicture}

Signalling Game


\begin{tikzpicture}[scale=1.4,font=\footnotesize]

\tikzset{

% Two node styles for game trees: solid and hollow

solid node/.style={circle,draw,inner sep=1.5,fill=black},

hollow node/.style={circle,draw,inner sep=1.5}

}


% Specify spacing for each level of the tree

\tikzstyle{level 1}=[level distance=12mm,sibling distance=25mm]

\tikzstyle{level 2}=[level distance=15mm,sibling distance=15mm]

\tikzstyle{level 3}=[level distance=17mm,sibling distance=10mm]

% The Tree

\node(0)[solid node,label=right:{Nature}]{}

child[grow=up]{node[solid node,label=above:{\begin{tabular}{c}

Sender\\ $t=t_1$

\end{tabular}}] {}

child[grow=left]{node(1)[solid node,label=below:{$[p]$}]{}

child{node[hollow node,label=left:{$(1,1)$}]{} edge from parent node [above]{$u$}}

child{node[hollow node,label=left:{$(2,0)$}]{} edge from parent node [below]{$d$}}

edge from parent node [above]{$L$}

}

child[grow=right]{node(3)[solid node,label=below:{$[q]$}]{}

child{node[hollow node,label=right:{$(0,0)$}]{} edge from parent node [below]{$d$}}

child{node[hollow node,label=right:{$(2,2)$}]{} edge from parent node [above]{$u$}}

edge from parent node [above]{$R$}

}

edge from parent node [right]{$0.4$}

}

child[grow=down]{node[solid node,label=below:{\begin{tabular}{c}

Sender\\ $t=t_2$

\end{tabular}}] {}

child[grow=left]{node(2)[solid node,label=above:{$[1-p]$}]{}

child{node[hollow node,label=left:{$(0,0)$}]{} edge from parent node [above]{$u$}}

child{node[hollow node,label=left:{$(0,1)$}]{} edge from parent node [below]{$d$}}

edge from parent node [above]{$L$}

}

child[grow=right]{node(4)[solid node,label=above:{$[1-q]$}]{}

child{node[hollow node,label=right:{$(1,1)$}]{} edge from parent node [below]{$d$}}

child{node[hollow node,label=right:{$(1,0)$}]{} edge from parent node [above]{$u$}}

edge from parent node [above]{$R$}

}

edge from parent node [right]{$0.6$}

};


% information set

\draw[dashed,rounded corners=10]($(1) + (-.45,.45)$)rectangle($(2) +(.45,-.45)$);

\draw[dashed,rounded corners=10]($(3) + (-.45,.45)$)rectangle($(4) +(.45,-.45)$);

% specify mover at 2nd information set

\node at ($(1)!.5!(2)$) {Receiver};

\node at ($(3)!.5!(4)$) {Receiver};

\end{tikzpicture}

Reaction Curves Dynamic Adjustment in Cournot Model


\begin{figure}

\begin{tikzpicture}[scale=1]

\draw [thick,<->] (0,7) node [below right] {$q_2$} --(0,0)--(7,0) node [below right] {$q_1$};

\node [below] at (2.35,0) {$q_1^*$};

\node [below] at (3.3,0) {$q_{1B}$};

\node [below] at (4.7,0) {$q_{1A}$};

\node [left] at (0,2.1) {$q_2^*$};

\node [left] at (0,1.4) {$q_{2B}$};

\node [left] at (0,0.7) {$q_{2A}$};

\node [above right] at (2.35,2.1) {$E$};

\node [above right] at (0.8,4.3) {$RC_1$};

\node [above right] at (3.6,1.5) {$RC_2$};

\draw (0,3.5)--(5.8,0);

\draw (0,5.7)--(3.7,0);

\draw (2.35,2.1)--(2.35,0);

\draw [dashed] (0,2.1)--(2.35,2.1);

\draw [dashed] (0,0.7)--(4.7,0.7)--(4.7,0);

\draw [dashed] (2.55,1.9)--(2.55,1.8)--(2.75,1.8)--(2.75,1.45)--(3.35,1.45)--(3.35,0.7);


\end{tikzpicture}

\caption {Reaction curves-linear demand case with constant and identical costs}

\end{figure}

Strategic Complements


\begin{figure}

\begin{tikzpicture}[scale=1]

\draw [thick, <->] (0,6.7) node [above left] {$p_2$} --(0,0)--(6.7,0) node [below right] {$p_1$};

\node [above left] at (2.1,2.1) {$E$};

\node [above] at (3.3,4.1) {$RC_2$};

\node [below right] at (5,3.3) {$RC_1$};

\draw [very thick] (0.6,1.5)--(5.3,3.5);

\draw [very thick] (1.3,0.9)--(3.9,4.6);

\draw [dashed] (0,2.2) node [left]  {$p_{pc}$}--(2.2,2.2)--(2.2,0) node [below] {$p_{pc}$};

\draw [dashed] (0,4.1) node [left] {$p_m$}--(4.1,4.1)--(4.1,0) node [below] {$p_m$};


\end{tikzpicture}

\caption {Reaction curves-strategic complements}

\end{figure}

General Equilibirum

Edgeworth box


\begin{figure}

\begin{tikzpicture}[scale=1]

\draw (0,0) node [align=center, below] {\footnotesize origin for\\ \footnotesize person A} -- (0,4) -- (6.9,4) node [align=center, right] {\footnotesize origin for\\ \footnotesize person $B$} -- (6.9,0) node [right] {\footnotesize $R$} -- (0,0);

\node at (7.2,1.6) {\rotatebox{90}{\footnotesize good $Y$}};

\draw (0,1.6) -- (6.9,1.6);

\draw (4.2,0) -- (4.2,1.6) -- (4.2,4);

\draw (4.2,1.6) -- (6.9,0);

\node [below,left] at (4.2,-.3) {\footnotesize good $X$};

\node [above, left] at (4.2,1.8) {\footnotesize $P$};

\draw [decorate,decoration={brace,amplitude=6pt},xshift=-1pt,yshift=0pt]

(6.9,1.6) -- (6.9,4) node [black,midway,xshift=-0.5cm] {\footnotesize $y_B$};

\draw [decorate,decoration={brace,amplitude=6pt,mirror},xshift=0pt,yshift=0pt]

(0,0) -- (0,1.6) node [black,midway,xshift=0.5cm] {\footnotesize $y_A$};

\draw [decorate,decoration={brace,amplitude=6pt},xshift=0pt,yshift=0pt]

(0,0) -- (4.2,0) node [black,midway,yshift=0.5cm] {\footnotesize $x_A$};

\draw [decorate,decoration={brace,amplitude=6pt,mirror},xshift=0pt,yshift=0pt]

(4.2,4) -- (6.9,4) node [black,midway,yshift=-0.5cm] {\footnotesize $x_B$};

\end{tikzpicture}

\caption{The Edgeworth box}

\end{figure}


Contract Curve


\begin{figure}

\begin{tikzpicture}[scale=1.3]

\draw (0,0) node [align=center, below] {\scriptsize Origin for\\ \scriptsize person A} -- (0,4.7) -- (6.9,4.7) node [align=center, right] {\scriptsize Origin for\\ \scriptsize person $B$} -- (6.9,0) -- (0,0);

\node [right] at (6.9,2.2) {\rotatebox{90}{\scriptsize Good $Y$}};

\node [below,left] at (4.2,-.3) {\scriptsize Good $X$};

\draw (1.3,4.7) to [out=-70, in=145] (3.7,1.4) to [out=-35, in=165] (6.9,0);

\node [left] at (2.8,2) {\scriptsize $C$};

\draw (2.8,4.7) to [out=-20, in=135] (4.9,3.4) to [out=-45, in=115] (6.9,0);

\node [right] at (5,3.5) {\scriptsize $C'$};

\draw (2.8,4.2) to [out=-15, in=135] (4.4,3.2) to [out=-45, in=110] (5.6,1.3);

\node [left] at (2.8,4.3) {\scriptsize $U'_B$};

\draw (3,3.9) to [out=-60, in=140] (3.8,2.8) to [out=-40, in=175] (5.5,2);

\node [left] at (3,3.9) {\scriptsize $U_A'$};

\node [above] at (3.8,2.8) {\scriptsize $S$};

\node [below] at (5.2,2) {\scriptsize $Q$};

\draw plot [smooth] coordinates {(2.8,3.3) (3.8,2.8) (4.7,1.3)};

\node [left] at (2.8,3.3) {\scriptsize $U_B^*$};

\draw plot [smooth] coordinates {(2.72,2.2) (3.8,2.8) (5,3.3)};

\node [left] at (1.4,4.3) {\scriptsize $U_A$};

\node [right] at (4,4.2) {\scriptsize $U_B$};

\end{tikzpicture}

\caption{The contract curve}

\end{figure}


Disequilibrium 


\begin{figure}

\begin{tikzpicture}[scale=1.2]

\draw (0,0) -- (0,4.2) -- (7.5,4.2) -- (7.5,0) -- (0,0);

\node [below] at (.7,-.1) {\scriptsize Origin for person A};

\node [above] at (7.1,4.3) {\scriptsize Origin for person $B$};

\node [right] at (7.7,2.3) {\rotatebox{90}{\scriptsize Good $Y$}};

\node [below,left] at (5.2,-.3) {\scriptsize Good $X$};

\draw (0,4) node [left] {\scriptsize $P'$} -- (7.5,0) node [below right] {\scriptsize $P$};

\draw (2.5,0) node [below] {\scriptsize $x_A$} -- (2.5,2.7);

\node [left] at (2.5,2.5) {\scriptsize $E_A$};

\draw (0,2.7) node [left] {\scriptsize $y_A$} -- (4.5,2.7);

\draw (4.5,4.2) node [above] {\scriptsize $x_B$} -- (4.5,1.6) node [below] {\scriptsize $E_B$} -- (7.5,1.6) node [right] {\scriptsize $y_B$};

\draw plot [smooth] coordinates {(0.8,4.2) (2.5,2.7) (4,2.1)};

\node [above] at (4,2.2) {\scriptsize $U_A$};

\draw plot [smooth] coordinates {(3,2) (4.5,1.6) (5.9,.4)};

\node [right] at (5.9,.4) {\scriptsize $U_B$};

\draw [decorate,decoration={brace,amplitude=6pt},xshift=0pt,yshift=0pt]

(2.5,2.7) -- (4.5,2.7) node [align=center, black,midway,yshift=0.8cm] {\scriptsize excess\\ \scriptsize supply\\ \scriptsize of X};

\draw [decorate,decoration={brace,amplitude=6pt, mirror},xshift=1pt,yshift=0pt]

(4.5,1.6) -- (4.5,2.7) node [align=center, black,midway,xshift=0.8cm] {\scriptsize excess\\ \scriptsize demand\\ \scriptsize for Y};

\end{tikzpicture}

\caption {A disequilibrium price ratio}

\end{figure}


Price Taking Equilibrium


\begin{figure}

\begin{tikzpicture}[scale=1.2]

\draw (0,0) node [align=center, below] {\scriptsize Origin for\\ \scriptsize person A} -- (0,3.6) -- (7,3.6) node [align=center, above right] {\scriptsize Origin for\\ \scriptsize person $B$} -- (7,0) -- (0,0);

\node [right] at (7.2,2) {\rotatebox{90}{\scriptsize Good $Y$}};

\node [below left] at (4,0) {\scriptsize Good $X$};

\draw (0,2.5) node [left] {\scriptsize $P'$} -- (7,0) node [below right] {\scriptsize $P$};

\node [below] at (2.1,1.7) {\scriptsize $E$};

\draw plot [smooth] coordinates {(0.7,1.8) (2.1,1.75) (3.4,.7)};

\node [right] at (4.5,1.5) {\scriptsize $U_A$};

\draw plot [smooth] coordinates {(.9,2.7) (2.1,1.75) (4.5,1.5)};

\node [right] at (3.4,.7) {\scriptsize $U_B$};

\end{tikzpicture}

\caption{The price-taking equilibrium}

\end{figure}


Public Economics

Laffer Curve


\begin{figure}

\begin{tikzpicture}[scale=0.5]

\scriptsize

\draw (0,11.5) -- (0,0) node[below left]{$0$} -- (11,0) node[below right]{$q$};


\node [above left] at (0,11){$100\%$};

\node [above] at (0,12){$Tax\ rates(t)$};

\node [below] at (5.5,0){$Tax\ revenue(T)$};


\draw (0,0)arc(-90:90:11cm and 5.5cm);

\draw (0,5.5) node[below left]{$t^*$} -- (11,5.5);

\draw (11.2,11) -- (11.7,11) -- (11.7,5.5) -- (11.2,5.5);

\node[align=left, right] at (11.7,8.25) {Prohibitive\\Range};


\draw[fill=gray] (11,5.5)arc(0:90:11cm and 5.5cm);

\draw[fill=gray] (11,5.5) -- (0,5.5) -- (0,11);


\end{tikzpicture}

\caption{The Laffer curve}

\end{figure}

Macroeconomics

Samuelson's Circular Flow Model


\begin{figure}

\begin{tikzpicture}[scale=1]


\node [above] at (1.1, 2.2) {$BUSINESS$};

\node [above] at (6.3, 2.2) {$PUBLIC$};


\draw [very thick] (0.9, 0) -- (0.9, 1.5) -- (0, 1.5) -- (0, 3.7) -- (0.9, 3.7) -- (0.9, 5.1) -- (6.5, 5.1) -- (6.5, 3.7) -- (7.4, 3.7) -- (7.4, 1.5) -- (6.6, 1.5) -- (6.6, 0) -- (0.9, 0);

\draw [very thick] (1.3, 0.4) -- (1.3, 1.5) -- (2.3, 1.5) -- (2.3, 3.7) -- (1.3, 3.7) -- (1.3, 4.7) -- (6.1, 4.7) -- (6.1, 3.7) -- (5.1, 3.7) -- (5.1, 1.5) -- (6.2, 1.5) -- (6.2, 0.4) -- (1.3, 0.4);

\draw [very thick, ->] (5.3, 0.6) node [left] {$Goods \ and \ services$} -- (5.7, 0.6);

\draw [very thick, ->] (5.3, 5.4) node [left] {$Wages, \ interest, \ etc$} -- (6.2, 5.4);

\draw [very thick, <-] (1.2, -0.3) -- (1.8, -0.3) node [right] {$Consumption\ purchases$};

\draw [very thick, <-] (1.6, 4.4) -- (2.1, 4.4) node [right] {$Productive\ services$};


\end{tikzpicture}

\caption{Samuelson's circular flow diagram}

\end{figure}

Modern Circular Flow Model


\begin{figure}

\begin{tikzpicture}[scale=1]


\node [above] at (3.25, 0.3) {$Households$};

\node [above] at (3.25, 3.7) {$Firms$};

\node [below] at (6.3, 3.6) {$I$};

\node [below] at (8.2, 3.6) {$G$};

\node at (7.7, 2.05){\rotatebox{-90}{$Banks$}};

\node at (9.5, 2.05){\rotatebox{-90}{$Government$}};

\node at (0, 2.2) [align = left, right] {Wages \ and \\ profits};

\node at (6.3, 2.2) [align = left, left] {Spending \\ on \ goods \\ and \\ services};


\draw [very thick] (1.8, 0) -- (4.7, 0) -- (4.7, 1) -- (1.8, 1) -- (1.8, 0);

\draw [very thick] (1.8, 3.4) -- (4.7, 3.4) -- (4.7, 4.4) -- (1.8, 4.4) -- (1.8, 3.4);

\draw [very thick, ->] [loosely dashed] (4.6, 4.4) to [out=100, in=0] (3.2, 5.6) to [out=180, in=90] (1.9, 4.4);

\draw [very thick] (7.3, 0.9) -- (8, 0.9) -- (8, 3.2) -- (7.3, 3.2) -- (7.3, 0.9);

\draw [very thick] (9.1, 0.9) -- (9.8, 0.9) -- (9.8, 3.2) -- (9.1, 3.2) -- (9.1, 0.9);


\draw [very thick, ->] (1.8, 3.9) to [out=-180, in=90] (0, 2.2) to [out=-90, in=180] (1.8, 0.5);

\draw [very thick, ->] (4.7, 0.5) to [out=10, in=-90] (6.5, 2.2) to [out=90, in=-10] (4.7, 3.7);

\draw [very thick, ->] [dashed] (4.7, 0.4) ..controls (6.2, 0.3) and (7.2, 0.4) ..(7.6, 0.9) node [below left] {$S$};

\draw [very thick, ->] [dashed] (4.7, 0.3) ..controls (7.4, 0.1) and (8.7, 0.3) ..(9.4, 0.9) node [below left] {$T$};

\draw [very thick, <-] [dashed] (4.7, 3.9) ..controls (6.2, 3.7) and (7.2, 3.5) ..(7.6, 3.2);

\draw [very thick, <-] [dashed] (4.7, 4.1) ..controls (7.4, 3.9) and (8.7, 3.7) ..(9.4, 3.2);


\end{tikzpicture}

\caption{The circular flow diagram of contemporary textbooks}

\end{figure}


AS-AD Diagram


\begin{figure}

\begin{tikzpicture}[scale=0.8]


\draw[thick] (0,9) node[above]{$P$}--(0,0) node[below right]{$0$}--(12,0) node[below]{$Y$};

\draw(1,1.5) ..controls (5,2) and (8,3) .. (8.5,9) node[above]{$AS$};

\draw (2,9) node[above]{$AD$}--(8.5,1.3);

\draw(8,9)--(8,0) node[below]{$Y_f$};

\draw[dashed](6.53,3.6)--(6.53,0) node[below] {$Y_e$};

\end{tikzpicture}


\caption{The AS-AD diagram}

\end{figure}

Keynesian Cross


\begin{figure}

\begin{tikzpicture}[scale=0.5]


\scriptsize


\draw[thick] (0,12) node[above]{$E$}--(0,0) node[below right]{$0$}--(12,0) node[below]{$Y$};

\draw(0,2)--(12,11) node[right]{$C(Y)+I+G+X-M(Y)$};

\draw(0,0)--(12,12) node[right]{$E(Y)=Y$};

\draw[dashed](8,8)--(8,0) node[below]{$Y_e$};

\draw[dashed](10,9.5)--(10,0) node[below]{$Y_f$};

\draw (0,0) ++(0:2) arc(0:45:2);

\node [right] at (0.5,0.5) {45\textdegree};


\end{tikzpicture}

\caption{Keynesian cross diagram}

\end{figure}

IS-LM


\begin{figure}

\begin{tikzpicture}[scale=0.5]


\scriptsize


\draw[thick] (0,9) node[left]{$i$}--(0,0) node[below left]{$0$}--(11,0) node[below]{$Y$};

\draw(6,9) node[left]{$IS_0$} ..controls (8,8) and (10,7) .. (11,2.5);

\draw(6,9) node[left]{$IS_0$} ..controls (8,8) and (10,7) .. (11,2.5);

\draw(3.3,6.5) node[left]{$IS_2$} ..controls (5,5.6) and (6,3.8) .. (6.8,1.2);

\draw(1.45,4.9) node[left]{$IS_1$} ..controls (2,4.5) and (3.5,4) .. (4,0.65);


\draw(0.8,1.1) ..controls (3.8,1.2) and (6.5,1.5) .. (8.25,6.2);

\draw[dashed](3.8,1.45) ..controls (6.2,1.7) and (8,2.5) .. (9.5,6.2);


\draw(9.5,0) node[below]{$Y_a$}--(9.5,6.2);

\draw[dashed](9.5,6.2)--(9.5,9);

\draw(8.25,0) node[below]{$Y_0$}--(8.25,9);

\node[above] at (8.1,9){$LM_0$};

\node[above] at (9.7,9){$LM_1$};


\draw(0,1.47) node[left]{$i_1$}--(3.8,1.47)--(3.8,0) node[below]{$Y_1$};

\draw(0,2.8) node[left]{$i_2$}--(6.2,2.8)--(6.2,0) node[below]{$Y_2$};

\draw(0,6.2) node[left]{$i_a$}--(9.5,6.2);

\draw(0,7.6) node[left]{$i_0$}--(8.25,7.6);


\end{tikzpicture}

\caption{IS-LM}

\end{figure}

Solow Growth Model


\begin{tikzpicture}[scale=0.6]

\draw[thick,<->] (0,10) node[above]{depreciation,saving}--(0,0)--(10,0) node[right]{$k$};

\node [below left] at (0,0) {$0$};

\draw(0,0)--(9,9) node[right]{$\delta k$};

\draw(0,0) ..controls (1,5) and (5,6) .. (10,7) node[right]{$sf(k)$};

\end{tikzpicture}

Patinkin Diagram


\begin{tikzpicture}[scale=0.5]


\scriptsize


\draw[thick] (0,12) node[above]{$E$}--(0,0) node[below right]{$0$}--(12,0) node[below]{$Y$};

\draw(0,0)--(12,12) node[right]{$E(Y)=Y$};

\draw(11,12) node[above,left]{$Y=S[(W/P)_0,K_0]$}--(11,0) node[below]{$Y_f$};

\draw(0,0) ..controls (1,6) and (9,9) .. (12,9.15) node[right]{$E=F(Y,r_1,M_0/P_1)$};

\draw(0,0) ..controls (1,7) and (10,10) .. (12,10.15) node[right]{$E=F(Y,r_2,M_0/P_2)$};

\draw(0,0) ..controls (1,8) and (11,11.23) .. (12,11.15) node[right]{$E=F(Y,r_0,M_0/P_0)$};

\draw[dashed](8.25,8.25)--(8.25,0) node[below]{$Y_{e1}$};

\draw[dashed](9.5,9.5)--(9.5,0) node[below]{$Y_{e2}$};

\draw (0,0) ++(0:2) arc(0:45:2);

\node [right] at (0.5,0.5) {45\textdegree};


\end{tikzpicture}

Money Demand


\begin{tikzpicture}[scale=0.5]

\tiny

\draw (0,13) node[below left]{$r$} -- (0,0) node[below left]{$0$} -- (14,0) node[below]{$M$};

\draw(0,11) node[above left]{$r'$} ..controls (0.5,2) and (6,2) .. (8,2);

\draw[dashed](0,2) node[left]{$r''$} -- (8,2);

\draw(8,2) -- (13,2) node[right]{$L_2$} ;


\draw(2.5,11) node[above]{$M(y=y_4)$} -- (2.5,0);

\draw(5,11) node[above]{$M(y=y_3)$} -- (5,0);

\draw(8,11) node[above]{$M(y=y_2)$} -- (8,0);

\draw(10.5,11) node[above]{$M(y=y_1)$} -- (10.5,0);


\end{tikzpicture}


Philips Curves


\begin{tikzpicture}[scale=0.5]


\scriptsize


\draw[thick] (0,6) node[below left] {$\dot{W}$} -- (0,0) node[below left]{$0$} -- (6,0) node[right]{$U$};

\node[below] at (3,-0.5) {$(i)$};

\draw(0.5,6) node[above right]{$PC_W$} ..controls (0.6,0.5) and (0.7,0) .. (5.8,-0.3);


\draw[thick][xshift=8cm] (0,6) node[below left] {$\dot{P}$} -- (0,0) node[below left]{$0$} -- (6,0) node[right]{$Y$};

\node[below] at (11,-0.5) {$(ii)$};

\draw[xshift=8cm](0,-0.6) ..controls (5,-0.5) and (5.5,0) .. (6,5.9) node[above]{$PC_P$};


\end{tikzpicture}

International Trade

Gains from trade


\begin{figure}

\begin{tikzpicture}[scale=.9]

\draw [<-] (0,7.8) node [left] {$x_2,y_2$} -- (0,0);

\draw [->] (0,0) -- (8.9,0) node [below] {$x_1,y_1$};

\node [left] at (0,6.45) {$P$};

\node [below] at (5.05,0) {$P'$};

\node [left] at (4.3,3.2) {$x^n$};

\node [below] at (2.4,5.4) {$y^f$};

\node [right] at (5.75,3.4) {$x^f$};

\draw (5.8,.5) -- (2.65,6.7);

\draw (.5,7.2) -- (7.7,1.7);

\draw (4.45,5.3) to [out=-90, in=140] (5.75,3.2) to [out=-40, in=160] (7.7,2.2);

\draw (4.15,4.3) to [out=-90, in=120] (4.55,3) to [out=-60, in=160] (7.4,1.1);

\draw (0,6.45) to [out=0, in=115] (4.4,3.2) to [out=-65, in=90] (5.05,0);

\end{tikzpicture}

\caption{Gains from trade}

\end{figure}


Industrial Organization

Production Differentiation

Hotelling Model


\begin{figure}

\begin{tikzpicture}

\draw (0,0) -- (10,0);

%draw vertical lines

\foreach \x in {0,1,4.6,8.8,10}

\draw (\x cm,3pt) -- (\x cm,-3pt);


%draw nodes

\draw (0,0) node[below=3pt] {$ 0 $} node[above=3pt] {$ $};

\draw (0.5,0) node[below=3pt] {$ $} node[above=18pt] {$ a $};

\draw (1,0) node[below=3pt] {$ A $} node[above=3pt] {$ $};

\draw (2.8,0) node[below=3pt] {$ $} node[above=18pt] {$ x-a $};

\draw (4.6,0) node[below=3pt] {$ x $} node[above=3pt] {$ $};

\draw (6.7,0) node[below=3pt] {$ $} node[above=18pt] {$ l-b-x $};

\draw (8.8,0) node[below=3pt] {$ B $} node[above=3pt] {$ $};

\draw (9.4,0) node[below=3pt] {$ $} node[above=18pt] {$ b $};

\draw (10,0) node[below=3pt] {$ l $} node[above=3pt] {$ $};


\draw[decorate, decoration = {brace, amplitude = 8pt}, xshift = 0pt, yshift = 10pt] (0, 0) -- (1, 0);

\draw[decorate, decoration = {brace, amplitude = 8pt}, xshift = 0pt, yshift = 10pt] (1, 0) -- (4.6, 0);

\draw[decorate, decoration = {brace, amplitude = 8pt}, xshift = 0pt, yshift = 10pt] (4.6, 0) -- (8.8, 0);

\draw[decorate, decoration = {brace, amplitude = 8pt}, xshift = 0pt, yshift = 10pt] (8.8, 0) -- (10, 0);


\end{tikzpicture}

\caption{Holtelling's line}

\end{figure}


Network Effect


\begin{tikzpicture}

\draw[thick,<->] (0,5) node[above]{$p$}--(0,0)--(8,0) node[right]{$N$};

\draw[thick,red] (0,0)..controls (3.5,6) ..(7,0) node[above right]{$p(N)$};

\draw[thick, blue] (0,3) node[left]{$p^*$} -- (7,3);


\draw[fill] (0,3) circle [radius=0.06];

\draw[fill] (1.8,3) circle [radius=0.06];

\draw[fill] (5.2,3) circle [radius=0.06];


\draw[dashed] (1.8,0) node[below]{$N^L$}--(1.8,3);

\draw[dashed] (5.2,0) node[below]{$N^H$}--(5.2,3);

\end{tikzpicture}



Insulating Traiff



\begin{tikzpicture}

\draw[thick,<->] (0,5) node[above]{$p$}--(0,0)--(8,0) node[right]{$N$};

\draw[red] (0,0)..controls (3.5,6) ..(7,0) node[above right]{$p$};

\draw[blue] (0,3) node[left]{$$} -- (7,3);


\draw[dashed] (1.8,0) node[below]{$N^L$}--(1.8,3);

\draw[dashed] (5.2,0) node[below]{$N^H$}--(5.2,3);


\draw[orange] (0,0)--(7,4) node[above]{insulating tariff};


\draw[black,fill=white] (0,3) circle [radius=0.06];

\draw[black,fill=white] (1.8,3) circle [radius=0.06];

\draw[fill=black] (5.2,3) circle [radius=0.06];

\end{tikzpicture}


Williamson Loss Triangle


\begin{tikzpicture}

\draw[thick,<->] (0,7) node[above]{$p$}--(0,0)--(8,0) node[right]{$q$};


\draw (0,6)--(6,0) node[above right]{D};

\draw (0,3) --(5,3) node[right]{$c_0$};

\draw(0,2) --(5,2) node[right]{$c_1$};


\draw[dashed] (0,4) node[left]{$p_1$}--(2,4)--(2,0) node[below]{$q_1$};

\draw[dashed] (0,3) node[left]{$p_0$}--(3,3)--(3,0) node[below]{$q_0$};


\path[pattern=horizontal lines,pattern color=red] (2,4)--(2,3)--(3,3);

\path[pattern=vertical lines,pattern color=blue] (0,3)--(2,3)--(2,2)--(0,2);


\end{tikzpicture}



Financial Economics

Asset Pricing


Markowitz Mean-Varinace Diagram


\begin{figure}

\begin{tikzpicture}[scale=0.8]

\draw (0,7.2) node [above] {$E(R)$}--(0,0)--(9.9,0)node [right] {$\sigma$};

\node [left] at (0,1.9) {$R_{RF}$};

\draw [thick, ->] (0,1.9) -- (8.6,5.1);

\draw [fill=black] (4.9,3.7) circle [radius =0.1] node[above]{$P^*$};

\draw [thick] [fill=gray] (4.9, 3.7) to [out=-160, in=90] (3, 2) to [out=-90, in=170] (5.2, 0.5) to [out=90, in=50] (5.7, 1.4) to [out=40, in=-180] (6.8, 1.7) to [out=90, in=-180] (8.3, 3.8) to [out=90, in=75] (8.5, 4.4) to [out=-180, in=-165] (5, 3.7);


\end{tikzpicture}

\caption {The Markowitz mean-variance diagram}

\end{figure}

Garman Market Microsturcture


\begin{tikzpicture}[scale=0.6]

\draw[thick,<->] (0,10) node[above]{$p$}--(0,0)--(10,0) node[right]{$\lambda$};

\draw(1,1)--(9,9) node[right]{$\lambda_b(p)$};

\draw(1,9)--(9,1) node[right]{$\lambda_a(p)$};

\draw[dashed](0,5) node [left] {$p^*$}--(5,5)--(5,0) node [below] {$\lambda^*$};

\draw[dashed](0,7) node [left] {$p_a$}--(3,7)--(3,0) node [below] {$\lambda$};

\draw[dashed](0,3) node [left] {$p_b$}--(3,3);

\draw[pattern=north west lines, pattern color=blue] (0,3) rectangle (3,7);

\end{tikzpicture}

Others

Mathamatics

Three Different Curves


\begin{tikzpicture}[scale=0.6]


% We start the first graph

\draw[<->] (0,5) node[above] {$y$} -- (0,0) -- (5,0) node[right] {$x$};

\draw plot [smooth] coordinates {(0.5,0.5) (2,1) (3,2) (4,4)};


% We start the second graph

\draw[<->, xshift=6cm] (0,5) node[above] {$y$} -- (0,0) -- (5,0) node[right] {$x$};

\draw [xshift=6cm] plot [smooth] coordinates {(0.5,0.5) (2.2,4) (4,0.5) };


% We start the third graph

\draw[<->, xshift=12cm] (0,5) node[above] {$y$} -- (0,0) -- (5,0) node[right] {$x$};

\draw [xshift=12cm] plot [smooth] coordinates {(0.5,4) (1.5,2.3) (2.2,1.6) (4,0.5) };


\end{tikzpicture}

Unit Simplex 


\begin{tikzpicture}[scale=1.3]

\draw [thick] (0,0) node [left] {$\Pi_3$} -- (3,1.8) node [below] {0} -- (3,5.4) node [right] {$\Pi_2$};

\draw [thick] (3,1.8) -- (6,0) node [right] {$\Pi_1$}x;

\draw [thick] (.4,.26) -- (3,4.8);

\draw [thick] (.4,.26) -- (5.55,.26) -- (3,4.8);

\node [thick,below] at (1,.26) {$(0,0,1)$};

\node [thick,right] at (3,5) {$(0,1,0)$};

\node [thick,right] at (5.65,.3) {$(1,0,0)$};

\end{tikzpicture}

Random Graph


\begin{tikzpicture}[scale=0.5]

\tiny

\draw [fill] (0,0) circle [radius =0.1] -- (0.8,-0.2) circle [radius =0.1];

\draw [fill] (0,0) circle [radius =0.1] -- (-0.5,0.5) circle [radius =0.1] -- (-1,1) circle [radius =0.1] -- (-1.5,1.5) circle [radius =0.1] -- (-2,2) circle [radius =0.1];

\draw [fill] (-2,2) circle [radius =0.1] -- (-3,2) circle [radius =0.1];
\draw [fill] (-3,2) circle [radius =0.1] -- (-3.7,2.2) circle [radius =0.1];
\draw [fill] (-3,2) circle [radius =0.1] -- (-3.7,1.8) circle [radius =0.1];

\draw [fill] (-2,2) circle [radius =0.1] -- (-1.5,2.5) circle [radius =0.1] -- (-1,3) circle [radius =0.1] -- (-0.5,3.5) circle [radius =0.1] -- (0,4) circle [radius =0.1] -- (0.5,4.5) circle [radius =0.1];

\draw [fill] (-1.5,2.5) circle [radius =0.1] -- (-1.65,3.1) circle [radius =0.1];

\draw [fill] (-1.65,3.1) circle [radius =0.1] -- (-1.95,3.65) circle [radius =0.1] -- (-2.25,4.2) circle [radius =0.1];

\draw [fill] (-1.65,3.1) circle [radius =0.1] -- (-1.65,3.75) circle [radius =0.1];

\draw [fill] (-1.5,2.5) circle [radius =0.1] -- (-0.7,2.7) circle [radius =0.1] -- (0.1,2.9) circle [radius =0.1] -- (0.9,3.1) circle [radius =0.1];

\draw [fill] (0.9,3.1) circle [radius =0.1] -- (1.8,3.1) circle [radius =0.1];

\draw [fill] (0.9,3.1) circle [radius =0.1] -- (1.7,3.25) circle [radius =0.1] -- (2.5,3.4) circle [radius =0.1] -- (3.3,3.55) circle [radius =0.1];

\draw [fill] (0,0) circle [radius =0.1] -- (0,-0.6) circle [radius =0.1] -- (0,-1.2) circle [radius =0.1];

\draw [fill] (0,-1.2) circle [radius =0.1] -- (-0.2,-1.7) circle [radius =0.1];
\draw [fill] (0,-1.2) circle [radius =0.1] -- (0.2,-1.7) circle [radius =0.1];

\draw [fill] (0.2,-1.7) circle [radius =0.1] -- (0.3,-2.3) circle [radius =0.1];
\draw [fill] (0.2,-1.7) circle [radius =0.1] -- (0.45,-2.26) circle [radius =0.1];

\draw [fill] (-0.2,-1.7) circle [radius =0.1] -- (-0.3,-2.3) circle [radius =0.1];
\draw [fill] (-0.2,-1.7) circle [radius =0.1] -- (-0.45,-2.26) circle [radius =0.1];

\draw [fill] (-0.45,-2.26) circle [radius =0.1] -- (-0.75,-2.86) circle [radius =0.1] -- (-1.05,-3.46) circle [radius =0.1] -- (-1.35,-4.06) circle [radius =0.1] -- (-1.65,-4.66) circle [radius =0.1];

\draw [fill] (-0.45,-2.26) circle [radius =0.1] -- (-0.8,-2.8) circle [radius =0.1] -- (-1.15,-3.34) circle [radius =0.1];

\draw [fill] (-0.3,-2.3) circle [radius =0.1] -- (-0.45,-2.9) circle [radius =0.1] -- (-0.6,-3.5) circle [radius =0.1] -- (-0.75,-4.1) circle [radius =0.1] -- (-0.9,-4.7) circle [radius =0.1];

\draw [fill] (-0.3,-2.3) circle [radius =0.1] -- (-0.4,-2.9) circle [radius =0.1] -- (-0.5,-3.5) circle [radius =0.1];
\draw [fill] (-0.3,-2.3) circle [radius =0.1] -- (-0.35,-2.9) circle [radius =0.1] -- (-0.4,-3.5) circle [radius =0.1];

\draw [fill] (-0.6,-3.5) circle [radius =0.1] -- (-0.8,-4.08) circle [radius =0.1];

\end{tikzpicture}

Right Continuous


\begin{tikzpicture}
\draw [->] (0,0.5) --(2.5,0.5);
\draw [->] (0.5,0)--(0.5,2.5);
\draw [red](0,1)--(1,1);
\draw [red](1,2)--(2,2);

\draw [red,dashed] (1,1) --(1,2); 
\draw [red, fill=white] (1,1) circle (1.5pt);
\draw [red, fill=red] (1,2) circle (1.5pt);
\end{tikzpicture}

Left Continuous


\begin{tikzpicture}
\draw [->] (0,0.5) --(2.5,0.5);
\draw [->] (0.5,0)--(0.5,2.5);
\draw [red](0,1)--(1,1);
\draw [red](1,2)--(2,2);

\draw [red,dashed] (1,1) --(1,2); 
\draw [red, fill=red] (1,1) circle (1.5pt);
\draw [red, fill=white] (1,2) circle (1.5pt);
\end{tikzpicture}

Probability Tree


\begin{tikzpicture}[scale=1.5,font=\footnotesize]

% Specify spacing for each level of the tree

\tikzstyle{level 1}=[level distance=12mm,sibling distance=40mm]

\tikzstyle{level 2}=[level distance=15mm,sibling distance=20mm]

\tikzstyle{level 3}=[level distance=15mm,sibling distance=12mm]


\tikzset{

solid node/.style={circle,draw,inner sep=1,fill=black},

}


% The Tree

\node(0)[solid node,label=above:{News}]{}

    child{node(1)[solid node,label=left:{Traders}]{}

        child{node[solid node]{}

        child{node[solid node,label=below:{Buy}]{} edge from parent node [left]{$1$}}

        child{node[solid node,label=below:{Sell}]{} edge from parent node [right]{$0$}}

        edge from parent node[left]{Informed} node [left, xshift=-15,yshift=-10]{$\mu$}

    }

    child{node[solid node]{}

        child{node[solid node,label=below:{Buy}]{} edge from parent node [left]{$\frac{1}{2}$}}

        child{node[solid node,label=below:{Sell}]{} edge from parent node [right]{$\frac{1}{2}$}}

        edge from parent node[right]{Uninformed} node [right,xshift=12, yshift=-10]{$1-\mu$}

    }

    edge from parent node [left,xshift=0, yshift=10]{Good: $V=V_H$ } node [left,xshift=-20, yshift=0]{$1-\delta$}

    }

    child{node(2)[solid node,label=right:{Traders}]{}

        child{node[solid node]{}

        child{node[solid node,label=below:{Buy}]{} edge from parent node [left]{$0$}}

        child{node[solid node,label=below:{Sell}]{} edge from parent node [right]{$1$}}

        edge from parent node[left]{Informed} node [left, xshift=-15,yshift=-10]{$\mu$}

    }

        child{node[solid node]{}

        child{node[solid node,label=below:{Buy}]{} edge from parent node [left]{$\frac{1}{2}$}}

        child{ node[solid node,label=below:{Sell}]{} edge from parent node [right]{$\frac{1}{2}$}}

        edge from parent node[right]{Uninformed} node [right,xshift=12, yshift=-10]{$1-\mu$}

    }

    edge from parent node[right,xshift=0, yshift=10]{Bad: $V=V_L$} node [right, xshift=20, yshift=0]{$\delta$}

};


\end{tikzpicture}


Probability Tree 2


\begin{tikzpicture}[scale=1.5,font=\footnotesize]

% Specify spacing for each level of the tree

\tikzstyle{level 1}=[level distance=12mm,sibling distance=43mm]

\tikzstyle{level 2}=[level distance=15mm,sibling distance=20mm]

\tikzstyle{level 3}=[level distance=15mm,sibling distance=10mm]


\tikzset{

solid node/.style={circle,draw,inner sep=1,fill=black},

}


% The Tree

\node(0)[solid node]{}

child{node(1)[solid node,label=left:{$V=1$}]{}

child{node[solid node,label=left:{$s_1=H$}]{}

child{node[solid node,label=below:{$s_2=U$}]{} edge from parent node [left]{$q$}}

child{ node[solid node,label=below:{$s_2=D$}]{} edge from parent node [right]{$1-q$}}

edge from parent node [left]{$p$}

}

child{node[solid node,label=right:{$s_1=H$}]{}

child{node[solid node,label=below:{$s_2=U$}]{} edge from parent node [left]{$q$}}

child{ node[solid node,label=below:{$s_2=D$}]{} edge from parent node [right]{$1-q$}}

edge from parent node [right]{$1-p$}

}

edge from parent node [left, yshift=3]{$\frac{1}{2}$}

}

child{node(2)[solid node,label=right:{$V=-1$}]{}

child{node[solid node,label=left:{$s_1=L$}]{}

child{node[solid node,label=below:{$s_2=U$}]{} edge from parent node [left]{$1-q$}}

child{ node[solid node,label=below:{$s_2=D$}]{} edge from parent node [right]{$q$}}

edge from parent node [left]{$p$}

}

child{node[solid node,label=right:{$s_1=L$}]{}

child{node[solid node,label=below:{$s_2=U$}]{} edge from parent node [left]{$1-q$}}

child{ node[solid node,label=below:{$s_2=D$}]{} edge from parent node [right]{$q$}}

edge from parent node [right]{$1-p$}

}

edge from parent node [right, yshift=3]{$\frac{1}{2}$}

};


\end{tikzpicture}

Export in PNG

To export Tikz graphics in png format, it is convenient to use "standalone" package. 

  1. Install standalone package to Latex
  2. Download and install latest ImageMagick.
  3. Download and install latest Ghostscript. 
  4. Add "--shell-escape" to the pdflatex command to allow the software to access to third party programs. (If you use Windows and Texworks, then you have to change it to "--enable-write18" and "-undump=pdflatex"
  5. Then use the latex file below.
Latex Template

\documentclass[tikz,convert={size=640}]{standalone}

\usetikzlibrary{arrows,calc, patterns, positioning, shapes.geometric, decorations.pathreplacing,decorations.markings}

\usepackage{graphicx}

\usepackage{rotating}

\usepackage{textcomp}

\begin{document}

    %%% Copy the code to here%%%

\end{document}

 

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