Accession Number : AD0439234

Title :   DYNAMIC PROGRAMMING OF ECONOMIC GROWTH,

Corporate Author : CALIFORNIA UNIV BERKELEY CENTER FOR RESEARCH IN MANAGEMENT SCIENCE

Personal Author(s) : Radner,Roy

Report Date : FEB 1964

Pagination or Media Count : 54

Abstract : A class of problems of optimal economic growth is formulated in terms of the functional equation approach of dynamic programming (Bellman, 1957). A study is made of the continuity and concavity properties of the state valuation function, i.e., the function indicating the maximum total discounted welfare (utility) that can be achieved starting from a given initial state of the economy. Under suitable conditions this function is characterized by a certain functional equation. Both the cases of a finite and an infinite planning horizon are treated, the latter case being discussed under the assumption of constant technology and tastes. Here iteration of a certain transformation associated with the functional equation is shown to provide convergence to the state valuation function. Exact solutions are given for the case of linear-logrithmic production and welfare functions. (Author)

Descriptors :   (*ECONOMICS, DYNAMIC PROGRAMMING), GROWTH(PHYSIOLOGY), MATHEMATICAL MODELS, THEORY, EQUATIONS, THEOREMS, MATHEMATICAL ANALYSIS

Distribution Statement : APPROVED FOR PUBLIC RELEASE