Abstract
The potential usefulness of the well-known turnpike theorem in [12] is for practical purposes rather limited, since numerical evaluation of the estimate given in [12] for the turnpike horizon N* gives poor results, unless the discount factor β is rather small. We contribute to the problem in the following directions:
-
(i)
Considerably improved estimates for N* are derived, including cases where β ≧ 1.
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(ii)
For dynamic programs with absorbing sets further improvement is derived.
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(iii)
Some numerical examples are given, including a rather detailed analysis of Howard’s toymaker example for arbitrary values of β.
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© 1977 ACADEMIA, Publishing House of the Czechoslovak Academy of Sciences, Prague
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Hinderer, K., Hübner, G. (1977). An Improvement of J. F. Shapiro’s Turnpike Theorem for the Horizon of Finite Stage Discrete Dynamic Programs. In: Kožešnik, J. (eds) Transactions of the Seventh Prague Conference on Information Theory, Statistical Decision Functions, Random Processes and of the 1974 European Meeting of Statisticians. Transactions of the Seventh Prague Conference on Information Theory, Statistical Decision Functions, Random Processes and of the 1974 European Meeting of Statisticians, vol 7A. Springer, Dordrecht. https://doi.org/10.1007/978-94-010-9910-3_26
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DOI: https://doi.org/10.1007/978-94-010-9910-3_26
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