Time Horizon, Objective Function, and Uncertainty in a Multiperiod Model of Firm Growth

Jean-Marc Boussard ()

American Journal of Agricultural Economics, 1971, vol. 53, issue 3, 467-477

Abstract: The growing literature pertaining to multiperiod programming models of farm growth raises three problems that are ordinarily solved with makeshift solutions: the duration of time to be included within the planning horizon; the arbitrage between present and future consumption; and the introduction of uncertainty. The connections between these questions are shown. The net worth of the firm at the end of the planning horizon is maximized under the constraint of a linear consumption function. In this case it is possible to use the turnpike theorem and some additional theorems on separability of matrices to derive a simple rule for deciding on the appropriate length of planning horizon. The introduction of uncertainty shortens the practical planning horizon defined according to this rule.

Date: 1971
References: Add references at CitEc
Citations: View citations in EconPapers (21)

Downloads: (external link)
http://hdl.handle.net/10.2307/1238224 (application/pdf)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:oup:ajagec:v:53:y:1971:i:3:p:467-477.

Access Statistics for this article

American Journal of Agricultural Economics is currently edited by Madhu Khanna, Brian E. Roe, James Vercammen and JunJie Wu

More articles in American Journal of Agricultural Economics from Agricultural and Applied Economics Association Contact information at EDIRC.
Bibliographic data for series maintained by Oxford University Press ().