Optimal Control of Nonlinear Processes With Applications in Drugs, C

Dynamic optimization is rocket science – and more. This volume teaches how to harness the modern theory of dynamic optimization to solve practical problems, not only from space flight but also in emerging social applications such as the control of drugs,

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Dieter Grass Jonathan P. Caulkins Gustav Feichtinger Gernot Tragler Doris A. Behrens

Optimal Control

Optimal Control of Nonlinear Processes With Applications in Drugs, Corruption, and Terror

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Optimal Control of Nonlinear Processes

Dieter Grass Jonathan P. Caulkins Gustav Feichtinger Gernot Tragler Doris A. Behrens ●



Optimal Control of Nonlinear Processes With Applications in Drugs, Corruption, and Terror

Dieter Grass Vienna University of Technology Institute for Mathematical Methods in Economics Argentinierstraße 8 A-1040 Vienna Austria [email protected]

Jonathan P. Caulkins RAND Research Center 201 N Craig St Ste 102 Pittsburgh PA 15213-1516 USA [email protected]

Gustav Feichtinger Vienna University of Technology Institute for Mathematical Methods in Economics Argentinierstraße 8 A-1040 Vienna Austria [email protected]

Gernot Tragler Vienna University of Technology Institute for Mathematical Methods in Economics Argentinierstraße 8 A-1040 Vienna Austria [email protected]

Doris A. Behrens University of Klagenfurt Department of Economics Universitätsstr. 65-67 9020 Klagenfurt Austria [email protected]

ISBN 978-3-540-77646-8

e-ISBN 978-3-540-77647-5

Library of Congress Control Number: 2008929913 © 2008 Springer-Verlag Berlin Heidelberg This work is subject to copyright. All rights are reserved, whether the whole or part of the material is concerned, specifically the rights of translation, reprinting, reuse of illustrations, recitation, broadcasting, reproduction on microfilm or in any other way, and storage in data banks. Duplication of this publication or parts thereof is permitted only under the provisions of the German Copyright Law of September 9, 1965, in its current version, and permissions for use must always be obtained from Springer-Verlag. Violations are liable for prosecution under the German Copyright Law. The use of general descriptive names, registered names, trademarks, etc. in this publication does not imply, even in the absence of a specific statement, that such names are exempt from the relevant protective laws and regulations and therefore free for general use. Cover design: WMXDesign GmbH, Heidelberg Printed on acid-free paper 9 8 7 6 5 4 3 2 1 springer.com

The authors dedicate this book: to Daniela, Michael, Ilse, and Engelbert; to Ellen, Jay, Joseph, and Jackie; to Ingrid, Susanne, Evelyn, Katja, and Basti; to Elisabeth, Katharina, Helen, and Ayana; to Lukas, Heinrich, and Marianne.

Preface

The goal of this book is to prepare readers to apply the optimal control theory to nonlinear processes beyond the standard applications. The examples investigated in depth are drawn from drug policy, corruption, and counter-terror, so this book will be of particular interest to economists, epidemiologists, and other scholars interested in the economics of crime, health, and violence. However, the book is designed to simultaneously appeal to an even larger audience of students in mathematics, economics, biosciences, and operations resear