On the dynamics of capital accumulation across space

Carmen Camacho, Benteng Zou and Maya Briani
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Maya Briani: Center for Mathematical Economics, Bielefeld University

No 376, Center for Mathematical Economics Working Papers from Center for Mathematical Economics, Bielefeld University

Abstract: We solve an optimal growth model in continuous space, continuous and bounded time. The optimizer chooses the optimal trajectories of capital and consumption across space and time by maximizing an objective function with both space and time discounting. We extract the corresponding Pontryagin conditions and prove their sufficiency. We end up with a system of two parabolic differential equations with the corresponding boundary conditions. Then, we study the roles of initial capital and technology distributions over space in various scenarios.

Keywords: Optimal control; Economic geography; Parabolic differential equations; Economics (search for similar items in EconPapers)
Date: 2011-08-12
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https://pub.uni-bielefeld.de/download/2315466/2319795 First Version, 2005 (application/pdf)

Related works:
Journal Article: On the dynamics of capital accumulation across space (2008)
Working Paper: On the dynamics of capital accumulation across space (2008)
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Persistent link: https://EconPapers.repec.org/RePEc:bie:wpaper:376

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