Saturday, 7 February 2015

limits - Convergence of a recurrent sequence defined by an=(lambdaRlambdaan1)/(1+an1)

I hope someone here can help me. While studying an economics problem I came to a math problem that I can't solve. I'll try to put the problem as succinctly as possible.
I came to a sequence where the nth element is defined by:



an=(λRλan1)/(1+an1)




where R is a known positive real number. What I want to prove is that the sequence converge for values of 0<λ<1 (negative lambdas do not make economic sense). This seems intuitively true based on the economics behind it. Also, I have run some simulations that tend to support this claim. However, I cannot get the proof right.



From this answer, I got the idea of making an=pn/qn, with p0=a0 and q0=1 (In all honesty, I don't understand 100% this answer). Then study the system given by:



[pnqn]=[λλR11][pn1qn1]



From there I immediately tried to prove the stability based on the trace and determinant of the matrix M: [λλR11]



However, from the stability conditions tr(M)<0 and det(M)>0 I get the results that λ should at the same time be greater than 1 and <0, which is fairly easy to see. Those results would suggest that there are no values of λ for which the system is stable. This seems to contradict some economic sense and also the simulations I have run.




I am incapable of getting out of this conundrum so far. My best guest is that I'm trying to prove the stability for the system [pnqn]
and while those might not be stable, the ratio pn/qn might be. And the ratio is actually the sequence I'm interested in.



All the best.

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