Turnpike Set Analysis in Stochastic Manufacturing Systems with Long-Run Average Cost
Optimal Control and Partial Differential Equations in Honour of Professor Alain Bensoussan’s 60th Birthday, J.L. Menaldi, E. Rofman, and A. Sulem (Eds.), IOS Press, Amsterdam, 2001, 414-423
10 Pages Posted: 5 Jun 2020
Date Written: 2001
This paper considers an optimal production planning problem for an infinite horizon stochastic manufacturing system with long-run average cost criterion. The optimal feedback control is characterized by turnpike sets with the aid of viscosity solutions to the dynamic programming equations. The structure of the turnpike sets is analyzed. It is shown that the turnpike sets exhibit the monotone property with respect to the system's production capacity.
Keywords: Stochastic production planning; turnpike set; dynamic programming; long-run average cost
JEL Classification: C61, M11, M20
Suggested Citation: Suggested Citation