A Correspondance-Theoretic Approach to Dynamic Optimization

Macroeconomic Dynamics, 13 (Supplement 1), 2009, 97–117.

21 Pages Posted: 23 Dec 2014

See all articles by Charalambos D. Aliprantis

Charalambos D. Aliprantis

Purdue University - Krannert School of Management

Gabriele Camera

Chapman University - Economic Science Institute; University of Bologna - Dept. of Economics

Date Written: December 22, 2014

Abstract

This paper introduces a method of optimization in infinite-horizon economies based on the theory of correspondences. The proposed approach allow us to study time-separable and non-time-separable dynamic economic models without resorting to fixed point theorems or transversality conditions. When our technique is applied to the standard time-separable model it provides an alternative and straightforward way to derive the common recursive formulation of these models by means of Bellman equations.

Keywords: Optimal Plans, Policy Function, Value Function

Suggested Citation

Aliprantis, Charalambos D. and Camera, Gabriele, A Correspondance-Theoretic Approach to Dynamic Optimization (December 22, 2014). Macroeconomic Dynamics, 13 (Supplement 1), 2009, 97–117.. Available at SSRN: https://ssrn.com/abstract=2541990

Charalambos D. Aliprantis

Purdue University - Krannert School of Management ( email )

1310 Krannert Building
West Lafayette, IN 47907-1310
United States

Gabriele Camera (Contact Author)

Chapman University - Economic Science Institute ( email )

Orange, CA 92866
United States

HOME PAGE: http://www1.chapman.edu/~camera/

University of Bologna - Dept. of Economics ( email )

Strada Maggiore 45
Bologna, 40125
Italy

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