Control of linear dynamic market systems
The paper introduces a perfect foresight dynamic equilibrium model where the behaviour of profit-maximizing producers is presented by a linear optimal control problem, while the market demand is a given time- dependent linear vector-function of prices. The resulting system is studied from the viewpoint of control theory. The questions of reachability (which is here equivalent to the existence of a dynamic equilibrium subject to any value of a terminal bound) and observability are of primary concern.
perfect foresight dynamic equilibrium model
scientific article; zbMATH DE number 4060952