Partial versus global optimizations in economic dynamics : the case of recursive programming ; paper prepared in honor of Rainer Thoss on the occasion of his 60th birthday

After having given a brief overview of important applications of recursive programming models which aim at partial optimization in economic dynamics: we present a reduced version of a type of recursive regional and sectoral allocation models suggested by Rainer Thoss. Then we discuss the question of what is implied by a Thoss partially optimizing model in terms of global intertemporal efficiency. With respect to this model we demonstrate that the many advantages of recursive programming concerning practical applicability come at the cost of possible dynamic allocation losses. We also indicate a line of future research to resolve this trade-off.