Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
5099422 | Journal of Economic Dynamics and Control | 2008 | 15 Pages |
Abstract
In this article we propose a method for solving a general class of four-dimension nonlinear modified Hamiltonian dynamic systems in closed form. This method may be used to study several intertemporal optimization problems sharing a common structure, which involves unbounded technological constraints as well as multiple controls and state variables. The method is developed by solving the first-order conditions associated with the planner's problem corresponding to the Lucas [1988. On the mechanics of economic development. Journal of Monetary Economics 22, 3-42] two-sector model of endogenous growth, and allows for explicitly showing the transitional dynamics of the model. Despite the externality, the socially optimal short-run trajectory is unique.
Related Topics
Physical Sciences and Engineering
Mathematics
Control and Optimization
Authors
José Ramón Ruiz-Tamarit,