Abstract
The considered nonlinear optimal control problem describes distributed investments into new and old capital under limited substitutability among vintages of different ages. The production output is defined by the CES production function with continuum of capital vintage inputs, learning, and technological change. Both balanced growth and transition dynamics are explored. The obtained outcomes lead to new interesting insights about the structure of optimal investment into old vintages.
| Original language | English |
|---|---|
| Pages (from-to) | 743-759 |
| Number of pages | 17 |
| Journal | Pure and Applied Functional Analysis |
| Volume | 6 |
| Issue number | 4 |
| Publication status | Published - 2021 |
Keywords
- CES production function
- learning
- Optimal investment
- technological change
- transition dynamics
- vintage capital substitutability
ASJC Scopus subject areas
- Analysis
- Applied Mathematics
- Control and Optimization