Work detail

Optimal Control Theory in Economic Application

Author: Bc. Jindřich Jurkovič
Year: 2008 - summer
Leaders: doc. RNDr. Ondřej Kalenda Ph.D., DSc.
Work type: Bachelors
Language: English
Pages: 37
Awards and prizes:
Abstract: The bachelor thesis Optimal Control Theory in Economic Application deals with an issue of customizing a mathematical theory for the economic application. First of all it aims to provide an insight into the optimal control theory in its more general form; in order to do so, it states a general optimization problem and one of the essential parts of the theory – the optimality conditions, i.e. conditions to be met by any solution to the stated problem. To demonstrate the application of these conditions, we use a microeconomic model of a firm which transfers part of its income into investment into its capital resources with a natural tendency to decay. For such model the optimality conditions are derived and – to a great extent – solved. At the same time, the thesis shows which problems could arise during the application and what possible sacrifice would these practical issues make to the theory.




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