A study of a model for regulating a regional economy with multi-objective optimization

Based on difference equations in the Cobb–Douglas production function, a model of regulating a regional economy with multi-objective optimization of efficiency and equity is set up, with the spatial distribution strategy of capital and labour force as the decision variables. Two basic conclusions drawn from the model are demonstrated: a country's economic development is decided by the consistency between the regional distributive strategy of incremental investment and the regional difference in marginal investment revenue. The two targets of efficiency and equity are strictly in conflict with each other if and only if the marginal investment revenue in the developed regions is higher than in the undeveloped, otherwise the targets are consistent.