Extension of Pontryagin maximum principle and its Economical Applications

First, an extension of Pontryagin Maximum Principle in Infinite-Horizon, which was presented by Aseev and Kryazhimiskii, is explained. Since this method is applicable inoptimal economical growth problems, for the first time several problems such as consumption and investment are solved. Moreover, for implementing Aseev andKryazhimiskii 's method on Iranian economy, Luis Serven model is introduced. Then it is calibrated on Iranian economy during the years 1385-1415. By applying the described method, the optimal consumption and investment for maximizing the social welfare are demonstrated. Also the sensitivity analysis is discussed

Keywords:

The Pontryagin Maximum Principle , Optimal Control , Economical Growth Problems , Infinite Horizon