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Optimization in discrete time
I have made optimizations in continuous time that belong to the control theory, for example one case:
$\max(\min)V[u(t)]=\int_0^Tf(t,x(t),u(t))dt$
constraint to: $\dot x=g(t,x(t),u(t))$
Where:
$x(t)$: state variable.
$u(t)$: control variable.
And…
manifold
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Current Value Hamiltonian VS Present Value Hamiltonian in Economics
I've been looking at a number of optimal control problems and have been wondering under what conditions one should use the current value Hamiltonian over the present value Hamiltonian.
Does it depend on the specific result we seek to derive? (pick…
EconJohn
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Parsing problem 1.D.5 in MWG
I am a little confused about the statement of 1.D.5 in MWG, which I will reproduce here for convenience. I have "solved" the problem, I just don't understand something particular.
$\textbf{(1.D.5)}$ Let $X = \{x,y,z\}$ and $\mathscr{B} = \{…
Seh-kai
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Is there an economic interpretation of the envelope theorem?
I wonder if envelope theorem has also some hidden economic interpretation. For example, Lagrangian multiplier in economics can have interpretation of 'shadow price' which is useful economic concept.
The envelope theorem seems like something that…
WilliamT
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Trying to track down the earliest usage of rivalry, tangibility, excludability, and durability in economics
I'm interested in a history of these terms, and wondered if anyone knows where I might find such a thing.
The first mention I can find for excludability is a 1957 law journal paper referring to a court case (inaccessible to me).
The earliest…
Translunar
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5
votes
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Keynes' conception of investment
Keynes defines saving as equal to investment, saying:
"Having now defined both income and consumption, the definition of saving, which is the excess of income over consumption, naturally follows ... Our definition of income also leads at once to the…
H Huang
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2 answers
Cournot oligopoly - first-order condition
I am reading an article that has this description of the first-order condition for a Cournot n-firm game:
Take $P(Q) = Q^{-1}$, $\pi_i(q_i, Q) = (Q^{-1} - c_i)q_i$.
Then the first-order condition for an interior profit-maximizing choice of $q_i$…
user219923
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What is the empirical price elasticity of demand for insulin?
A lot of textbooks say that demand for insulin is perfectly inelastic. I don’t think this is quite true (and I am a type 1 diabetic). It’s clearly very inelastic, but not perfectly so. There are things you can do to reduce your insulin intake, e.g.…
Mohan
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Datasets with pre- and post migration earnings
I am interested in computing the pre- and post-migration earnings of international migrants, especially those migrating from low income to high income countries (or vice versa).
The data should allow me to compute pre- and post-migration earnings…
LutzHendricks
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Why have so many legitimate smaller biotechs sprung up and thrived?
I stumbled this question on r/AskScienceDiscussion, but I'd like to ask it from a microeconomics or competition standpoint.
Why can't Big Pharma accomplish what legitimate small biotechs have? Unquestionably Big Pharma has more money and can corner…
user4020
5
votes
4 answers
Where do remittances come into play in the formula for GDP?
In the classic formula for GDP, i.e., GDP=C+I+G+X-M, where are remittances accounted for? With remittances as high as third of GDP for developing countries, I wonder how they are not explicit in this equation.
Bravo
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Why are Americans at the top of nearly every field?
I live in India, and having spent several years in America before returning, I noticed that Americans dominate in nearly every sphere of human activity. For example, the US seems to be blessed with the best musicians, the best sportsmen and…
Joebevo
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Is QE the equivalent of printing money?
I heard somewhere that QE is not the same as printing money -- in fact as I know it, QE is the purchase of assets in exchange for more liquid and high-quality, better collaborated debt. In other words, it stimulates the exchange of liquid fiat, and…
economics
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Proof that stochastic discount factor is positive in complete markets
I am looking for a reference (with a proof possibly) to understand why the completeness of markets implies that the stochastic discount factor is strictly positive in the context of intertemporal consumption, i.e. when a agent FOC implies
$$
p_t =…
Three Diag
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Is the income derived from owning a live animal profit or rent?
Natural resources are considered non-produced and yield rents, including land and the fruits of the land, e.g. trees. Does this extend to live animals? Or are live animals considered “produced” goods (capital) that yield profits?
Does it make a…
sba222
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