Resource allocation problem in a two-sector economic model of special form (Q2269353)

In the paper the resource allocation problem for a two-sector economic model is considered. The model is of special form, which describes the particular situation arising in practice. The optimal control problem with dynamics described by two nonlinear differential equations is considered on a given finite time interval. It is shown that, under certain conditions on the model parameters, the optimal solution contains a singular mode. The optimal solution is constructed in a closed form. The theoretical basis for obtained results is provided by necessary optimality conditions (Pontriagin's maximum principle) and sufficient conditions in terms of constructions of Pontriagin's maximum principle.