Optimisation of Cycling Trends in Hamiltonian Systems of Economic Growth Models

Abstract

The paper analyses dynamical growth models predicting the cyclic development of investigated economic factors. The provided research deals with an optimal control problem based on the economic growth model with the production function of Cobb–Douglas type. Following the Pontryagin maximum principle, we derived the Hamiltonian system and conducted its qualitative analysis, which reveals conditions for the cyclic behaviour of the optimal solutions around the isolate steady state. Numerical experiments visually illustrated the obtained results by demonstrating a phase portrait corresponding to a steady state of the focal type.

Keywords

• optimal control
• economic growth
• dynamic model
• Hamiltonian system
• Pontryagin maximum principle
• cyclic behaviour