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To model combinatorial decision problems involving uncertainty and probability, we introduce stochastic constraint programming. Stochastic constraint programs contain both decision variables (which we can set) and stochastic variables…

Artificial Intelligence · Computer Science 2009-03-09 Toby Walsh

We consider a discrete time financial market with proportional transaction costs under model uncertainty, and study a num\'eraire-based semi-static utility maximization problem with an exponential utility preference. The randomization…

Mathematical Finance · Quantitative Finance 2019-08-02 Shuoqing Deng , Xiaolu Tan , Xiang Yu

In a recent paper it has been shown that if Cesaro and Abel limits for a certain discrete time optimal control problem are not equal, then there is a duality gap between a certain infinite-dimensional linear programming problem and its…

Optimization and Control · Mathematics 2020-10-29 Ilya Shvartsman

A new application of duality relations of stochastic processes is demonstrated. Although conventional usages of the duality relations need analytical solutions for the dual processes, we here employ numerical solutions of the dual processes…

Systems and Control · Computer Science 2015-10-14 Jun Ohkubo

We consider the robust exponential utility maximization problem in discrete time: An investor maximizes the worst case expected exponential utility with respect to a family of nondominated probabilistic models of her endowment by…

Portfolio Management · Quantitative Finance 2019-02-12 Daniel Bartl

We consider how to use the Bellman residual of the dynamic programming operator to compute suboptimality bounds for solutions to stochastic shortest path problems. Such bounds have been previously established only in the special case that…

Artificial Intelligence · Computer Science 2012-02-20 Eric A. Hansen

We consider scheduling problems for unit jobs with release times, where the number or size of the gaps in the schedule is taken into consideration, either in the objective function or as a constraint. Except for a few papers on energy…

Data Structures and Algorithms · Computer Science 2020-07-21 Marek Chrobak , Mordecai Golin , Tak-Wah Lam , Dorian Nogneng

We consider a broad class of dynamic programming (DP) problems that involve a partially linear structure and some positivity properties in their system equation and cost function. We address deterministic and stochastic problems, possibly…

Optimization and Control · Mathematics 2026-04-21 Yuchao Li , Dimitri Bertsekas

This paper introduces a dual problem to study a continuous-time consumption and investment problem with incomplete markets and stochastic differential utility. For Epstein-Zin utility, duality between the primal and dual problems is…

Mathematical Finance · Quantitative Finance 2016-01-15 Anis Matoussi , Hao Xing

We study a robust stochastic optimization problem in the quasi-sure setting in discrete-time. We show that under a lineality-type condition the problem admits a maximizer. This condition is implied by the no-arbitrage condition in models of…

Mathematical Finance · Quantitative Finance 2018-05-11 Ariel Neufeld , Mario Sikic

Most inverse optimization models impute unspecified parameters of an objective function to make an observed solution optimal for a given optimization problem with a fixed feasible set. We propose two approaches to impute unspecified…

Optimization and Control · Mathematics 2019-07-19 Timothy C. Y. Chan , Neal Kaw

In this paper, we derive sufficient and necessary maximum principles for a stochastic optimal control problem where the system state is given by a controlled stochastic differential equation with default. We prove existence of a unique…

Optimization and Control · Mathematics 2021-05-26 Khalida Bachir Cherif , Nacira Agram , Kristina Dahl

We survey research that studies the connection between the computational complexity of optimization problems on the one hand, and the duality gap between the primal and dual optimization problems on the other. To our knowledge, this is the…

Optimization and Control · Mathematics 2011-11-16 Prabhu Manyem

Semi-infinite programs are a class of mathematical optimization problems with a finite number of decision variables and infinite constraints. As shown by Blankenship and Falk (Blankenship and Falk. "Infinitely constrained optimization…

Optimization and Control · Mathematics 2020-09-21 Stuart M. Harwood , Dimitri J. Papageorgiou , Francisco Trespalacios

The aim of this paper is to address optimality of stochastic control strategies via dynamic programming subject to total variation distance ambiguity on the conditional distribution of the controlled process. We formulate the stochastic…

Optimization and Control · Mathematics 2014-02-06 Ioannis Tzortzis , Charalambos D. Charalambous , Themistoklis Charalambous

We treat utility maximization from terminal wealth for an agent with utility function $U:\mathbb{R}\to\mathbb{R}$ who dynamically invests in a continuous-time financial market and receives a possibly unbounded random endowment. We prove the…

Portfolio Management · Quantitative Finance 2018-03-23 Miklos Rasonyi

We consider a Markov chain approximation scheme for utility maximization problems in continuous time, which uses, in turn, a piecewise constant policy approximation, Euler-Maruyama time stepping, and a Gauss-Hermite approximation of the…

Optimization and Control · Mathematics 2020-01-07 Athena Picarelli , Christoph Reisinger

This paper investigates the problem of maximizing expected terminal utility in a discrete-time financial market model with a finite horizon under non-dominated model uncertainty. We use a dynamic programming framework together with…

Mathematical Finance · Quantitative Finance 2017-10-03 Laurence Carassus , Romain Blanchard

The canonical duality theory has provided with a unified analytic solution to a range of discrete and continuous problems in global optimization, which can transform a nonconvex primal problem to a concave maximization dual problem over a…

Optimization and Control · Mathematics 2012-10-04 Xiaojun Zhou

During recent years the interest of optimization and machine learning communities in high-probability convergence of stochastic optimization methods has been growing. One of the main reasons for this is that high-probability complexity…