The paper presents a transformation of a multi-stage optimal control model with random switching time to an age-structured optimal control model. Following the mathematical transformation, the advantages of the present approach, as compared to a standard backward approach, are discussed. They relate in particular to a compact and unified representation of the two stages of the model: the applicability of wellknown numerical solution methods and the illustration of state and control dynamics. The paper closes with a simple example on a macroeconomic shock, illustrating the workings and advantages of the approach. Keywords Optimal control theory • Age-structured optimal control theory • Multi-stage • Random switch • Catastrophic disaster Mathematics Subject Classification 34K35 • 49J55 • 49K15 1 Introduction Optimal control models with a variable time horizon continue to be the object of intensive research interest from both a theoretical and an applied point of view. Contributions can, in principle, be subdivided into two classes: (i) optimal control models with random time horizon and (ii) multi-stage optimal control models. Communicated by Mimmo Iannelli.
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