Existence of dominant solutions in linear output feedback

The standard LQ-regulator is known to be a dominant controller in the sense that the optimal cost is minimal for all initial states xOεRn. In general, static or dynamic output feedback controllers don't have this dominance property. In this paper, it is shown that in the general multivariable case and for the original cost functional a dynamic output feedback controller using an observer is dominant if and only if the observer is perfectly initialized.