This chapter addresses the most widely used subclass of convex programming: linear programming. After introducing the general formulation, it explores its economic interpretation, duality theory, and computational aspects such as the simplex method with its intuitive economic explanation. Applications include international trade models (the concept of comparative advantage), the Giffen paradox, the paradox of “more for less,” and environmental input–output analysis in terms of the Leontief pollution model. The linear structure facilitates both theoretical insights and empirical analysis, making linear programming indispensable in economic studies.

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Linear Programming

  • Mikuláš Luptáčik,
  • Klaus Prettner

摘要

This chapter addresses the most widely used subclass of convex programming: linear programming. After introducing the general formulation, it explores its economic interpretation, duality theory, and computational aspects such as the simplex method with its intuitive economic explanation. Applications include international trade models (the concept of comparative advantage), the Giffen paradox, the paradox of “more for less,” and environmental input–output analysis in terms of the Leontief pollution model. The linear structure facilitates both theoretical insights and empirical analysis, making linear programming indispensable in economic studies.