A dynamic programming approach to optimal pollution control under uncertain irrevesibility : the poisson case

Raouf Boucekkine (1) , Weihua Ruan (2, 1) , Benteng Zou (3)

1 ESC Rennes School of Business
2 Purdue University [West Lafayette]
3 University of Luxembourg [Luxembourg]

We solve a bimodal control problem with a non-concavity and certainly through a Poisson process underlying the transition from a mode to another. We use a dynamic programming approach and are able to uncover the global optimal dynamics (including optimal non-monotonic paths) under a few linear-quadratic assumptions, which do not get rid of the non-concavity of the problem. This is in contrast to the related literature on pollution control under irreversibility which usually explores local dynamics along monotonic solution pahs to first-order Pontryagin conditions.

Domaines: Ecologie, Environnement

Raouf Boucekkine, Weihua Ruan, Benteng Zou. A dynamic programming approach to optimal pollution control under uncertain irrevesibility : the poisson case. Communications in Optimization Theory, 2023. ⟨hal-04107276⟩