Efficient and optimal programs when investment is irreversible. A duality theory

Tapan Mitra; Debraj Ray

doi:10.1016/0304-4068(83)90030-7

Efficient and optimal programs when investment is irreversible. A duality theory

Tapan Mitra, Debraj Ray

Research output: Contribution to journal › Article › peer-review

Abstract

An attempt is made in this paper to formulate a satisfactory duality theory of efficient and optimal programs in intertemporal models with irreversible inveatment. The introduction of the constraint that depreciated capital stock cannot be used for present consumption makes the meaningful choice and interpretation of dual variables a more difficult problem, as is pointed out by means of an example. A new definition of a competitive program is introduced, and this is seen to lead to useful characterizations of efficient and optimal programs.

Original language	English (US)
Pages (from-to)	81-113
Number of pages	33
Journal	Journal of Mathematical Economics
Volume	11
Issue number	1
DOIs	https://doi.org/10.1016/0304-4068(83)90030-7
State	Published - Jan 1983

ASJC Scopus subject areas

Economics and Econometrics
Applied Mathematics

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10.1016/0304-4068(83)90030-7

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abstract = "An attempt is made in this paper to formulate a satisfactory duality theory of efficient and optimal programs in intertemporal models with irreversible inveatment. The introduction of the constraint that depreciated capital stock cannot be used for present consumption makes the meaningful choice and interpretation of dual variables a more difficult problem, as is pointed out by means of an example. A new definition of a competitive program is introduced, and this is seen to lead to useful characterizations of efficient and optimal programs.",

author = "Tapan Mitra and Debraj Ray",

note = "Funding Information: *The authors wish to thank Mr. T.C.A. Anant, Mr. K. Sengupta, and Mr. S. Sharma for their helpful comments. Research of the first author was supported by a National Science Foundation Grant and an Alfred P. Sloan Research Fellowship. The research reported here is part of the second author{\textquoteright}s Ph.D. thesis at Cornell University.",

year = "1983",

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doi = "10.1016/0304-4068(83)90030-7",

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AU - Ray, Debraj

N1 - Funding Information: *The authors wish to thank Mr. T.C.A. Anant, Mr. K. Sengupta, and Mr. S. Sharma for their helpful comments. Research of the first author was supported by a National Science Foundation Grant and an Alfred P. Sloan Research Fellowship. The research reported here is part of the second author’s Ph.D. thesis at Cornell University.

PY - 1983/1

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N2 - An attempt is made in this paper to formulate a satisfactory duality theory of efficient and optimal programs in intertemporal models with irreversible inveatment. The introduction of the constraint that depreciated capital stock cannot be used for present consumption makes the meaningful choice and interpretation of dual variables a more difficult problem, as is pointed out by means of an example. A new definition of a competitive program is introduced, and this is seen to lead to useful characterizations of efficient and optimal programs.

AB - An attempt is made in this paper to formulate a satisfactory duality theory of efficient and optimal programs in intertemporal models with irreversible inveatment. The introduction of the constraint that depreciated capital stock cannot be used for present consumption makes the meaningful choice and interpretation of dual variables a more difficult problem, as is pointed out by means of an example. A new definition of a competitive program is introduced, and this is seen to lead to useful characterizations of efficient and optimal programs.

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Efficient and optimal programs when investment is irreversible. A duality theory

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