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Path-dependent Hamilton-Jacobi equations with super-quadratic growth in the gradient and the vanishing viscosity method

2021/01/29 by Erhan Bayraktar, Bayraktar, Erhan, Christian Keller +1
Economics, Econometrics and Finance · Mathematics · #Stochastic processes and financial applications #Mathematical Biology Tumor Growth #Geometric Analysis and Curvature Flows

paper · pdf · doi:10.48550/arxiv.2102.00038

Abstract

The non-exponential Schilder-type theorem in Backhoff-Veraguas, Lacker and Tangpi [Ann. Appl. Probab., 30 (2020), pp. 1321-1367] is expressed as a convergence result for path-dependent partial differential equations with appropriate notions of generalized solutions. This entails a non-Markovian counterpart to the vanishing viscosity method. We show uniqueness of maximal subsolutions for path-dependent viscous Hamilton-Jacobi equations related to convex super-quadratic backward stochastic differential equations. We establish well-posedness for the Hamilton-Jacobi-Bellman equation associated to a Bolza problem of the calculus of variations with path-dependent terminal cost. In particular, uniqueness among lower semi-continuous solutions holds and state constraints are admitted.

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