Optimization by Vector Space Methods
Optimization by Vector Space Methods
Paper: A controlled linearized kalman filter for economic forecasting and adaptive modelling
Automatica (Journal of IFAC)
Brief paper: Game theory applied to dynamic duopoly problems with production constraints
Automatica (Journal of IFAC)
| Hi-index | 22.15 |
The purpose of this paper is primarily to model the Danish economy as a differential game among the sectors, and to solve this game using an algorithm (A) published in full detail elsewhere. This numerical algorithm (A) is first described briefly. It is used for the approximation of open-loop Nash-Cournot equilibrium controls in a differential game of fixed duration and initial state; it is based upon a hierarchical decomposition of the differential game into optimal control problems, with a fictive referee for the Nash-Cournot playing rule. Each constrained optimal control problem is solved by means of the generalized reduced gradient using constraint co-ordination. The algorithm has been applied to a nonlinear dynamic sectoral model of the Danish economy, which is described in detail. The control functions are: investments, labour, write-offs, marginal tax rates in each sector. The state variables are: foreign debt, state budget excess. Some results for the 1947-1952 period are given and they show that the open-loop Nash equilibrium controls obtained are somehow closer to the actual historical controls than those yielded by maximizing classical welfare criterions.