Infinite Horizon Dynamic Optimization With Unbounded Returns: Necessity, Sufficiency, Existence, Uniqueness, Convergence and a Sequence of Counterexamples
23 Pages Posted: 20 Dec 2018
Date Written: December 3, 2018
In this paper, we state sufficiency, necessity, convergence, existence and uniqueness results for infinite horizon optimal control problems with unbounded payoffs in which the assumptions are very weak and there are no topological assumptions about the model components. We also state a sequence of simple counterexamples for various popular false beliefs, often used over-simplifications of methodology or same incorrect results in this field.
Keywords: Dynamic Optimization, Infinite Horizon, Unbounded Payoffs, Feedback, Bellman Equation, Terminal Condition, Sufficiency, Necessity, Existence, Uniqueness, Convergence, Counterexample, Dynamic Games
JEL Classification: C02, C60, C61, Q20, Q30, Q50
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