Abstract
A class of isoperimetric variational calculus problems is solved. It is shown that the said class ties together seemingly dissimilar optimal control problems in economics and physics, to wit, the classical nonrenewable resource extracting model of the firm, the model of the patient worker, and the principle of maximum entropy. In particular, it is shown that a certain family of wealth maximizing nonrenewable resource extracting firms extract at the rate that maximizes the entropy of extraction, and that patient intertemporal utility maximizing individuals do not procrastinate and maximize the entropy of leisure.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
