optimal lot size model for deteriorating items with demand rate dependent on displayed stock level dsl and partial backordering in this paper we consider the problem of determining the lot size of a single deteriorating item with the demand rate dependent on displayed stock level selling price of an item and frequency of advertisement in the popular electronic and print media also through the sales representatives shortages if any are allowed and partially backlogged with a variable rate which depends on the duration of waiting time upto the arrival of next lot here the transportation cost for replenishing the goods is considered explicitly and the storage capacity of the showroom shop is assumed to be limited finite according to the relative size of the stock level dependency demand parameters and the storage capacity of the showroom shop different scenarios with sub scenarios have been mentioned and solved with the help of grg generalised reduced gradient method and the computational procedure the convexity analysis is done by showing the average profit function in each case as pseudo concave to illustrate the results and its significant features a numerical example is given finally to study the effect of changes of demand parameters deterioration backlogging parameters and mark up rate on the maximum initial stock level shortage level frequency of advertisement per cycle along with the maximum average profit are presented numerically

optimal pricing and lot sizing under conditions of perishability finite production and partial backordering and lost sale abstract perishable products constitute a sizable component of inventories common questions in a production and selling situation involving a perishable or a non perishable product are what should be the price and what should be the size of the replenishment when demand for the product is price sensitive pricing and lot sizing decisions are interdependent similarly when a product is highly perishable the demand may need to be backlogged to avoid costs due to deterioration i e perishability and backlogging are complementary conditions in this paper we consider the pricing and lot sizing problem for a perishable good under finite production exponential decay and partial backordering and lost sale the backlogging phenomenon in the literature is often modeled using backordering and lost sale costs these cost parameters however are not easy to estimate in practice in this paper we use a new approach to model backlogging of demand in this approach customers are viewed to be impatient the backlogging option gets used only when it is economic to do so we extend the analysis presented for a perishable product to the case in which the product is non perishable

the effects of inflation and time value of money on an economic order quantity model with a random product life cycle abstract for several decades the economic order quantity eoq model and its variations have received much attention from researchers recently there has been an investigation into an eoq model incorporating a random product life cycle and the concept of time value of money this paper extends the previous research in several areas first we investigate the impact of inflation on the choice of replenishment quantities second the unit cost which has been inadvertently omitted in the previous research is included in the objective function to properly model the problem third we consider the normal distribution as a product life cycle in addition to the exponential distribution fourth we develop a simulation model which can be used for any probability distribution

partial backlogging inventory lot size models for deteriorating items with fluctuating demand under inflation abstract in this paper the traditional inventory lot size model is extended to allow not only for general partial backlogging rate but also for inflation the assumptions of equal cycle length and constant shortage length imposed in the model developed by moon et al moon i giri b c ko b 2005 economic order quantity models for ameliorating deteriorating items under inflation and time discounting european journal of operational research 162 3 773 785 are also relaxed for any given number of replenishment cycles the existence of a unique optimal replenishment schedule is proved and further the convexity of the total cost function of the inventory system in the number of replenishments is established the theoretical results here amend those in yang et al yang h l teng j t chern m s 2001 deterministic inventory lot size models under inflation with shortages and deterioration for fluctuating demand naval research logistics 48 2 144 158 and provide the solution to those two counterexamples by skouri and papachristos skouri k papachristos s 2002 note on deterministic inventory lot size models under inflation with shortages and deterioration for fluctuating demand by yang et al naval research logistics 49 5 527 529 finally we propose an algorithm to find the solution and obtain some managerial results by using sensitivity analyses

dynamic economic lot size model with perishable inventory this paper considers an economic lot size els model for perishable products where an inventory stock s deterioration rate and its carrying cost in each period depend on the age of the stock we discuss situations where the traditional els models are not applicable and propose a new model with general concave production and inventory cost functions we explore the structural properties of the optimal solutions and use them to develop a dynamic programming algorithm which solves the problem in polynomial time we also consider special cases of the general model which are solvable with reduced computational complexities

a production lot size inventory model for deteriorating items and arbitrary production and demand rates abstract in this paper we present a method for finding the optimal replenishment schedule for the production lot size model with deteriorating items where demand and production are allowed to vary with time in an arbitrary way and in which shortages are allowed the method is illustrated by a numerical example

deteriorating inventory model with quantity discount pricing and partial backordering inventory models with quantity discount pricing and partial backordering although common in practice have received very little attention from researchers the objective of this study is to develop a deterministic inventory model with quantity discount pricing and partial backordering when the product in stock deteriorates with time most retailers make pricing decisions of their products at certain times of the year and these decisions affect demand in this study the demand rate is assumed to decrease as price for the product increases unlike traditional inventory models that seek to minimize cost the objective of this study is to maximize profit the findings of this study are particularly relevant to retailers of deteriorating products in a competitive environment a numerical example is given to illustrate the theory

integrated inventory model for deteriorating items under a multi echelon supply chain environment abstract as the industrial environment becomes more competitive supply chain management has become essential the objective of this research is to develop a multi echelon inventory model for a deteriorating item and to derive an optimal joint total cost from an integrated perspective among the supplier the producer and the buyer a computer code is developed to derive the optimal solution a numerical example is given to illustrate the model this paper shows that the integrated approach strategy results in the lowest joint total cost as compared with the independent decision approaches

an eoq model with noninstantaneous receipt and exponentially deteriorating items under two level trade credit abstract this paper considers the impact of the trade credit policy on the classical economic production quantity epq model for an item subject to exponential decays essentially this study focuses on an exponentially deteriorating item under the conditions of the retailer receiving the supplier trade credit and providing the customer trade credit simultaneously so as to minimize the average total cost a theorem is developed to determine the optimal replenishment policies the main contribution to literature is the inclusion of the latter type of payment delay finally through numerical examples sensitive analysis shows the influence of key model parameters

optimal stopping and restarting production times for an eoq model with deteriorating items and time dependent partial backlogging abstract yan and cheng j operational res soc 49 1998 1288 1295 presented a general production inventory model with production rate product demand rate and deterioration rate all considered as functions of the time their model allows for shortages and partial backlogging of the unsatisfied demand at a constant rate in this paper we extend the results of yan and cheng to cover the case where the backlogging rate is a time dependent function and we propose an algorithm for the solution of this problem we also propose some conditions which we believe to be necessary for the validity for some of yan s and cheng s statements the paper closes with numerical examples which cover each one of the cases considered in the paper

a deteriorating inventory model with time varying demand and shortage dependent partial backlogging abstract recently chu et al p chu k l yang s k liang t niu note on inventory model with a mixture of back orders and lost sales european journal of operational research 159 2004 470 475 presented the necessary condition of the existence and uniqueness of the optimal solution of padmanabhan and vrat g padmanabhan p vrat inventory model with a mixture of back orders and lost sales international journal of systems science 21 1990 1721 1726 however they included neither the purchase cost nor the cost of lost sales into the total cost in this paper we complement the shortcoming of their model by adding not only the cost of lost sales but also the non constant purchase cost and then extend their model from a constant demand function to any log concave demand function we also provide a simple solution procedure to find the optimal replenishment schedule further we use a couple of numerical examples to illustrate the results and conclude with suggestions for future research

the production inventory problem of a product with time varying demand production and deterioration rates abstract in this paper we consider the production inventory problem in which the demand production and deterioration rates of a product are assumed to vary with time shortages of a cycle are allowed to be backlogged partially two models are developed for the problem by employing different modeling approaches over an infinite planning horizon solution procedures are derived for determining the optimal replenishment policies a procedure to find the near optimal operating policy of the problem over a finite time horizon is also suggested

economic models as analogies people often wonder why economists analyse models whose assumptions are known to be false while economists feel that they learn a lot from such exercises we suggest that part of the knowledge generated by academic economists is case based rather than rule based that is instead of offering general rules or theories that should be contrasted with data economists often analyse models that are theoretical cases which help understand economic problems by drawing analogies between the model and the problem thus economic models empirical data experimental results and other sources of knowledge are all on equal footing that is they all provide cases to which a given problem can be compared we offer complexity arguments that explain why case based reasoning may sometimes be the method of choice and why economists prefer simple cases many economists think of their discipline as a successful social science economics relies on rigorous and non trivial mathematical and statistical analyses the paradigm of microeconomics is viewed as a unified approach that can deal with all problems of social interaction and it is indeed adopted by other disciplines economics is popular with students and economics professors are in high demand within the academic world and outside it 1 however the basic assumptions of economic theories have been harshly criticised by psychologists presumably showing in laboratory experiments that these assumptions frequently do not hold if the assumptions of economics are all wrong why do economists keep using them why do they develop sophisticated mathematical models based on such flimsy foundations this question is our starting point we elaborate on it and discuss two additional puzzles in section 1 we then offer a possible resolution to these puzzles in section 2 namely that some of the reasoning in economics is casebased rather than rule based and that economists view themselves as generating the cases to which real problems might be analogous true to the method of our discipline we construct a model in section 4 that illustrates the advantages of this mode of research in section 5 we discuss the virtues of a general paradigm or to be precise of the standard language that such a paradigm employs section 6 concludes

on an eoq model for perishable items under stock dependent selling rate and time dependent partial backlogging by dye and ouyang in 2005 dye and ouyang proposed an eoq model for perishable items under stock dependent selling rate and time dependent partial backlogging and then established the unique optimal solution to the problem when building up inventory is not profitable however they did not provide the optimal solution to the problem when building up inventory is profitable in this note we establish an appropriate model in which building up inventory is profitable and then provide an algorithm to find the optimal solution to the problem a numerical example is used to illustrate the proposed model

a comparison between two pricing and lot sizing models with partial backlogging and deteriorated items abstract recently abad 2003 optimal pricing and lot sizing under conditions of perishability finite production and partial backordering and lost sale european journal of operational research 144 677 685 studied the pricing and lot sizing problem for a perishable good under finite production exponential decay partial backordering and lost sale in this article we extend his model by adding not only the backlogging cost but also the cost of lost goodwill we then analytically compare the net profits per unit time between abad s 2003 model and goyal and giri s 2003 the production inventory problem of a product with time varying demand production and deterioration rates european journal of operational research 147 549 557 model in abad s model the cycle starts with an instant production to accumulate stocks then stops production to use up stocks and finally restarts production to meet the unsatisfied demands by contrast in goyal and giri s model the cycle begins with a period of shortages then starts production until accumulated inventory reaches certain level and finally stops production and uses up inventory our theoretical results show that there is no dominant one between these two models furthermore we provide certain conditions under which one model has more net profit per unit time than the other finally we give several numerical examples to illustrate the results

a returns policy for distribution channel coordination of perishable items abstract this paper deals with a retailer s operating policies for a perishable product when he agrees with his supplier not to return the unsold product to his supplier provided that the supplier gives some discount on the wholesale price mathematical formulations are developed based on a periodic review inventory model under lifo and fifo issuing policies the demand rate is assumed to be a function of the retail price and instantaneous inventory level decision variables are the amount of supplier s price discount that the retailer can accept in return for adopting the no returns condition the retail price and order size also numerical examples are solved with tabu search algorithm for sensitivity analysis

economic order quantity models for ameliorating deteriorating items under inflation and time discounting the items that incur a gradual loss in quality or quantity over time while in inventory are usually called deteriorating items in reality there are some items whose value or utility or quantity increase with time and those items can be termed as ameliorating items in this paper an effort has been made to incorporate these two opposite physical characteristics of stored items into inventory model we develop models for ameliorating deteriorating items with time varying demand pattern over a finite planning horizon taking into account the effects of inflation and time value of money optimal solutions of the proposed models are derived and the effects of amelioration deterioration on the inventory replenishment policies are studied with the help of numerical examples

the joint economic lot size problem a review abstract this article reviews lot size models which focus on coordinated inventory replenishment decisions between buyer and vendor and their impact on the performance of the supply chain these so called joint economic lot size jels models determine order production and shipment quantities from the perspective of the supply chain with the objective of minimizing total system costs this paper first describes the problem studied introduces the methodology of the review and presents a descriptive analysis of the selected papers subsequently papers are categorized and analyzed with respect to their contribution to the coordination of different echelons in the supply chain finally the review highlights gaps in the existing literature and suggests interesting areas for future research

effects of inflation and time value of money on an inventory model with time dependent demand rate and shortages abstract in a recent paper datta and pal investigated the effects of inflation and time value of money on an inventory model with linearly increasing demand and finite shortage cost however their models are formulated under the assumption of equal inventory carrying time during each replenishment cycle in this paper we redevelop the models of datta and pal by relaxing this assumption and modifying their mathematical formulations our models can be applicable to both growing and declining markets with general continuous time dependent demand rates numerical examples are provided to illustrate the developed models

analysis of postponement strategy for perishable items by eoq based models abstract this paper develops economic order quantity model eoq based models with perishable items to evaluate the impact of a form postponement strategy on the retailer in a supply chain we formulate models for a postponement system and an independent system to minimize the total average cost function per unit time for ordering and keeping n perishable end products an algorithm is given to derive the optimal solutions of the proposed models the impact of the deterioration rate on the inventory replenishment policies is studied with the help of theoretical analysis and numerical examples our theoretical analysis and computational results show that a postponement strategy for perishable items can give a lower total average cost under certain circumstances

economic production quantity model for items with imperfect quality abstract the assumptions necessary to justify the use of economic production quantity epq eoq models are rarely met to provide mathematical models that more closely conform to actual inventories and respond to the factors that contribute to inventory costs the models must be extended or altered this paper hypothesizes a production inventory situation where items received or produced are not of perfect quality items of imperfect quality not necessarily defective could be used in another production inventory situation that is less restrictive process and acceptance control the electronics industry gives good examples of such situations this paper extends the traditional epq eoq model by accounting for imperfect quality items when using the epq eoq formulae this paper also considers the issue that poor quality items are sold as a single batch by the end of the 100 screening process a mathematical model is developed and numerical examples are provided to illustrate the solution procedure

a cooperative inventory policy with deteriorating items for a two echelon model a cooperative inventory policy between supplier and buyer is proposed unlike other studies we consider the case of deteriorating items and permit the completed back order in the problem we solve the problem without the condition of equal replenishments periods during a specified planning horizon and present a procedure to find the optimal solution a case is presented to demonstrate the application of the proposed approach the sensitivity analysis for a cooperation policy between supplier and buyer also are explored

inspection policy for inventory system with deteriorating products abstract typical inventory models usually focus on screening out the deteriorating items not much attention is paid to the situation that a proportion of deteriorated items are sold to consumers together with serviceable items during a replenishment cycle this paper first presents a model to formulate the process of such kind of mixed sales a simple closed form solution is obtained for maximizing the net profit per unit time under the assumption of small deterioration rate the effect of shortage back ordering is then considered and closed form solutions of optimal ordering quantity and replenishment time are obtained under similar assumption we further study the effect of inspection policies on optimal decisions for a deteriorating inventory system a dynamic programming approach is proposed for solving the optimal policy numerical examples are then provided to demonstrate our conclusions and results

economic ordering quantity models for items with imperfect quality abstract in this paper we first look at the issue of non shortages in models with proportional imperfect quality when the proportion of the imperfects is a random variable more specifically we revisit the papers of salameh and jaber int j prod econom 64 2000 59 and chan et al prod plann control 14 2003 588 and we point out that the sufficient conditions given in these papers to ensure that shortages will not occur may not really prevent their occurrence next considering the timing of withdrawing the imperfect quality items from stock we clarify a point not clearly stated in salameh and jaber int j prod econom 64 2000 59 and we extented this model to the case in which withdrawing takes place at the end of the planning horizon finally we establish that the objective of maximizing the mean average profit which was set in salameh and jaber int j prod econom 64 2000 59 is superfluous and the results given there can be obtained by ignoring the revenue issues assumed in the model and minimizing directly the mean average cost

information percolation with equilibrium search dynamics we solve for the equilibrium dynamics of information sharing in a large population each agent is endowed with signals regarding the likely outcome of a random variable of common concern individuals choose the effort with which they search for others from whom they can gather additional information when two agents meet they share their information the information gathered is further shared at subsequent meetings and so on equilibria exist in which agents search maximally until they acquire sufficient information precision and then search minimally a tax whose proceeds are used to subsidize the costs of search improves information sharing and can in some cases increase welfare on the other hand endowing agents with public signals reduces information sharing and can in some cases decrease welfare

an economic order quantity model for deteriorating items with partially permissible delay in payments linked to order quantity abstract to attract more sales suppliers frequently offer a permissible delay in payments if the retailer orders more than or equal to a predetermined quantity w in this paper we generalize goyal s k 1985 eoq under conditions of permissible delay in payments journal of the operational research society 36 335 338 economic order quantity eoq model with permissible delay in payment to reflect the following real world situations 1 the retailer s selling price per unit is significantly higher than unit purchase price 2 the interest rate charged by a bank is not necessarily higher than the retailer s investment return rate 3 many items such as fruits and vegetables deteriorate continuously and 4 the supplier may offer a partial permissible delay in payments even if the order quantity is less than w we then establish the proper mathematical model and derive several theoretical results to determine the optimal solution under various situations and use two approaches to solve this complex inventory problem finally a numerical example is given to illustrate the theoretical results

perishable inventory theory a review this paper reviews the relevant literature on the problem of determining suitable ordering policies for both fixed life perishable inventory and inventory subject to continuous exponential decay we consider both deterministic and stochastic demand for single and multiple products both optimal and sub optimal order policies are discussed in addition a brief review of the application of these models to blood bank management is included the review concludes with a discussion of some of the interesting open research questions in the area

determining optimal lot size for a two warehouse system with deterioration and shortages using net present value abstract in this paper we develop a deterministic inventory model for deteriorating items with two warehouses by minimizing the net present value of the total cost deterioration rates of items in the two warehouses may be different in addition we allow for shortages and complete backlogging we then prove that the optimal replenishment policy not only exists but also is unique under some condition further the result reveals that the reorder interval based on the average total cost if it exists must be longer than that derived using net present value finally we use yang s h l yang european journal of operational research 157 2004 344 356 numerical example to illustrate the model and conclude the paper with suggestions for possible future research

an optimization approach for managing fresh food quality throughout the supply chain one of the most challenging tasks in today s food industry is controlling the product quality throughout the food supply chain in this paper we integrate food quality in decision making on production and distribution in a food supply chain we provide a methodology to model food quality degradation in such a way that it can be integrated in a mixed integer linear programming model used for production and distribution planning the resulting model is applied in an illustrative case study and can be used to design and operate food distribution systems using both food quality and cost criteria

replenishment and pricing policy for deteriorating items taking into account the time value of money abstract a deteriorating inventory model taking into account the time value of money is developed for a deterministic inventory system with price dependent demand this study applies the discounted cash flows dcf approach for problem analysis a heuristic approach is presented to derive the near optimal replenishment and pricing policy that tries to maximize the total net present value profit a numerical example is implemented to illustrate the theory

efficient inventory control for imperfect quality items in this paper we present a general eoq model for items that are subject to inspection for imperfect quality each lot that is delivered to the sorting facility undertakes a 100 per cent screening and the percentage of defective items per lot reduces according to a learning curve the generality of the model is viewed as important both from an academic and practitioner perspective the mathematical formulation considers arbitrary functions of time that allow the decision maker to assess the consequences of a diverse range of strategies by employing a single inventory model a rigorous methodology is utilised to show that the solution is a unique and global optimal and a general step by step solution procedure is presented for continuous intra cycle periodic review applications the value of the temperature history and flow time through the supply chain is also used to determine an efficient policy furthermore coordination mechanisms that may affect the supplier and the retailer are explored to improve inventory control at both echelons the paper provides illustrative examples that demonstrate the application of the theoretical model in different settings and lead to the generation of interesting managerial insights

an order level lot size inventory model with inventory level dependent demand and deterioration abstract many inventory models have been developed for various deteriorating items with constant demand rate it is a common experience that for perishable consumer goods the age of inventory has a negative impact on the demand due to the loss of consumer confidence on such product consumers tend to keep off perishable items which have reached closer to their expiry dates this paper describes an inventory model in which the demand is considered as a composite function consisting of a constant component and a variable component which is proportional to the inventory level in the periods when there is a positive inventory buildup the rate of production is considered finite and the decay rate as exponential the total cost function is composed of four cost components of all phases of the cycle backorder replenishment inventory buildup inventory depletion and shortage this cost function is later reduced to a two variable function using boundary relations to determine iteratively the set of values of the variables that resulted in minimum cost per cycle the optimum lot size and order level were then obtained with relations established previously results are demonstrated for an instance of the model

some results for inventory models having inventory level dependent demand rate abstract this paper considers the inventory level dependent demand rate situation in generalized eoq models an interesting result linking the total inventory cost and the optimal policy for such a frame work is obtained and is shown to be consistent for all the models discussed in the paper

economics of alliances the lessons for collective action this essay provides an up to date summary of the findings of the literature on the economics of alliances we show that the study of the economics of alliances has played a pivotal role in understanding and applying public good analysis to real world applications we establish that the manner in which alliances address burden sharing and allocative issues is related to strategic doctrines weapon technology perceived threats and membership composition past contributions are evaluated and areas needing further development are identified the theoretical and empirical knowledge gained from the study of alliances is shown to be directly applicable to a wide range of international collectives

an eoq model with partial backordering and advance payments for an evaporating item abstract in the classic economic order quantity model the purchasing cost of an order is paid at the time of its receipt in some cases retailers ask purchasers to pay all or a fraction of the purchasing cost in advance and may allow them to divide the prepayment into several equal sized parts in this paper an economic order quantity model for an evaporating item with partial backordering and partial consecutive prepayments is developed with a real case study of a gasoline station real numerical examples illustrate the proposed model and the solution method

an inventory model for deteriorating items with stock dependent demand rate abstract this paper discusses an inventory model with an inventory level dependent demand rate followed by a constant demand rate for items deteriorating at a constant rate where the terminal condition of zero inventory at the end of the scheduling period has been relaxed sensitivity of the decision variables to changes in the parameter values is examined and the effects of these changes on the optimal policy are discussed in brief

integrating deterioration and lifetime constraints in production and supply chain planning a survey abstract items with short lifetimes that are subject to deterioration are important in the business world research has a long tradition in integrating deterioration and value loss effects into mathematical models for inventory planning and control where such effects are understood as a general loss or shrinkage of inventory however there has been little work in the modeling of lifetime restrictions of items to prevent wastage and disposals especially in a dynamic planning context globalization and other trends extend the consideration of single companies to whole supply chains implying increased coordination and information needs this is important as planning decisions impact lead times and thus the quality of items in the whole supply chain products that exceed their useful lifetime can impose high costs due to inventory loss or the need to rework them this implies increased utilization of scarce resources e g machine time metals and or energy thereby increasing co 2 levels we survey the state of the art regarding depreciation effects and the modeling of lifetime constraints as well as a classification of models following business planning functions of the value chain a critical evaluation of approaches and their limitations is provided highlighting directions for future research

inventory models with ramp type demand rate partial backlogging and weibull deterioration rate in this paper an inventory model with general ramp type demand rate time dependent weibull deterioration rate and partial backlogging of unsatisfied demand is considered the model is studied under the following different replenishment policies a starting with no shortages and b starting with shortages the model is fairly general as the demand rate up to the time point of its stabilization is a general function of time the backlogging rate is any non increasing function of the waiting time up to the next replenishment the optimal replenishment policy for the model is derived for both the above mentioned policies

market for information experimental evidence predictions of the noisy rational expectations equilibrium ree model are found to be relatively accurate for both asset and information markets in the laboratory when information about an asset s uncertain dividend is sold to a fixed number of highest bidders prices allocations efficiency and distribution of profit predictions of the full revelation ree model in the asset market dominate the predictions of the walrasian model demand for information shifts to the left and its price declines close to zero when the price of information is fixed at a relatively high level the number of informed agents and the informativeness of the asset market tends to adjust to permit the informed agents to recover their investment in information

an integrated inventory model for a single vendor and multiple buyers with ordering cost reduction abstract forming strategic alliances and utilizing modern information technologies have been the two most important ways for firms to gain such competitive advantages as lower logistics costs and secure customers loyalty in this paper we consider an integrated inventory system where a single vendor purchases and processes raw materials in order to deliver finished items to multiple buyers the vendor and all buyers are willing to invest in reducing the ordering cost e g establishing an electronic data interchange based inventory control system in order to decrease their joint total cost the amount of investment determines the planned ordering cost and hence affects their replenishment decisions one major managerial implication from this ordering cost reduction is that the efforts to streamline and speedup transactions via the application of information technologies may result in a higher degree of coordination and automation among allied trading parties an analytical model is developed to derive the optimal investment amount and replenishment decisions for both vendor and buyers the exponential ordering cost function is then applied to our general model and a numerical analysis is performed to provide interesting insights of the model numerical results show that the vendor and all the buyers can benefit directly from substantial cost savings by this ordering cost reduction investment

markets transparency and the corporate bond market for decades corporate bonds primarily traded in an opaque environment quotations which indicate prices at which dealers are willing to transact were available only to market professionals most often by telephone prices at which bond transactions were completed were not made public the u s corporate bond market became much more transparent with the introduction of the transaction reporting and compliance engine trace in july 2002 beginning that date bond dealers were required to report all trades in publicly issued corporate bonds to the national association of security dealers which in turn made transaction data available to the public in this paper we describe trading protocols in the corporate bond market and assess the impact of the increase in transparency on the market we review how trace has affected the costs that corporate bond investors paid to bond dealers for their transactions we canvass the opinions of a variety of finance professionals and consider articles in the trade press to obtain a broader view of the impact of transparency on the corporate bond market

determining optimal selling price and lot size with a varying rate of deterioration and exponential partial backlogging in this paper a deterministic inventory model for deteriorating items with price dependent demand is developed the demand and deterioration rates are continuous and differentiable function of price and time respectively in addition we allow for shortages and the unsatisfied demand is partially backlogged at a negative exponential rate with the waiting time under these assumptions for any given selling price we first develop the criterion for the optimal solution for the replenishment schedule and prove that the optimal replenishment policy not only exists but also is unique if the criterion is not satisfied the inventory system should not be operated next we show that the total profit per unit time is a concave function of price when the replenishment schedule is given we then provide a simple algorithm to find the optimal selling price and replenishment schedule for the proposed model finally we use numerical examples to illustrate the algorithm

an optimal replenishment policy for non instantaneous deteriorating items with stock dependent demand and partial backlogging abstract in this study we consider a problem of determining the optimal replenishment policy for non instantaneous deteriorating items with stock dependent demand in the model shortages are allowed and the backlogging rate is variable and dependent on the waiting time for the next replenishment the necessary and sufficient conditions of the existence and uniqueness of the optimal solution are shown as the special cases the results for the models with instantaneous or non instantaneous deterioration rate and with or without shortages are derived further we analytically identify the best circumstance among these special cases based on the minimum total relevant cost per unit time sensitivity analysis of the optimal solution with respect to major parameters is carried out finally four numerical examples are presented to demonstrate the developed model and the solution procedure

an integrated production inventory model with imperfect production processes and weibull distribution deterioration under inflation abstract this study develops an integrated production and inventory model from the perspectives of both the manufacturer and the retailer the model assumes a varying rate of deterioration partial backordering inflation imperfect production processes and multiple deliveries the elapsed time until the production process shift is assumed to be arbitrarily distributed the discounted cash flow and classical optimization technique are used to derive the optimal solution a numerical example including the sensitivity analysis is given to validate the results of the production inventory model the integrated decision results in lower optimal joint cost compared with an independent decision by the manufacturer and the retailer

an optimal production inventory model for deteriorating items with multiple market demand the global markets of today offer more selling opportunities to the deteriorating items manufacturers but also pose new challenges in production and inventory planning from a production management standpoint opportunities to exploit the difference in the timing of the selling season between geographically dispersed markets for deteriorating items are important to improving a firm s profitability in this paper we examined the above issue with an insightful production inventory model of a deteriorating items manufacturer selling goods to multiple markets with different selling seasons we also provided a solution procedure to find the optimal replenishment schedule for raw materials and the optimal production plan for finished products a numerical example was then used to illustrate the model and the solution procedure finally sensitivity analysis of the optimal solution with respect to major parameters was carried out

two warehouse partial backlogging inventory models with three parameter weibull distribution deterioration under inflation abstract in many inventory systems the effects of deterioration of physical goods have drawn much attention of various researchers in recent years the more the deterioration is the more the order quantity would be according to such consideration taking the deterioration rate into account is necessary thus in this paper i develop the two warehouse partial backlogging inventory model introduced in yang 2006 to incorporate three parameter weibull deterioration distribution the objective is to derive the optimal replenishment policy that minimizes the net present value of total relevant cost per unit time two alternative models are compared based on the minimum cost approach the study shows that the optimal solution not only exists but also is unique model 2 is still less expensive to operate than model 1 in the proposed model finally some numerical examples and sensitivity analysis on parameters are made to validate the results of the proposed inventory system

dynamic pricing in the presence of inventory considerations research overview current practices and future directions the benefits of dynamic pricing methods have long been known in industries such as airlines hotels and electric utilities where the capacity is fixed in the short term and perishable in recent years there has been an increasing adoption of dynamic pricing policies in retail and other industries where the sellers have the ability to store inventory three factors contributed to this phenomenon 1 the increased availability of demand data 2 the ease of changing prices due to new technologies and 3 the availability of decision support tools for analyzing demand data and for dynamic pricing this paper constitutes a review of the literature and current practices in dynamic pricing given its applicability in most markets and its increasing adoption in practice our focus is on dynamic intertemporal pricing in the presence of inventory considerations

two warehouse inventory models for deteriorating items with shortages under inflation abstract in this paper the two warehouse inventory problem for deteriorating items with constant demand rate and shortages under inflation is considered in contrast to the traditional deterministic two warehouse inventory model with shortages at the end of each replenishment cycle an alternative model in which each cycle begins with shortages and ends without shortages is proposed here the optimal solution not only exists but also is unique comparing these two two warehouse inventory models the study shows that the proposed model is less expensive to operate than the traditional one in the case of the inflation rate is greater than zero hence under the consideration of inflationary effect the proposed model is less expensive finally some numerical examples for illustration are provided

joint pricing and ordering policy for two echelon imperfect production inventory model with two cycles abstract this study deals with an imperfect epq economic production quantity price dependent inventory model over two types of cycles in the first cycle the retailer sells only good product with actual price and in the second he sells the products with a discount price in the production run time the non conforming items are produced at a random rate and they are reworked after the regular production run time and the reworked items are almost perfect as good as original quality items the retailer starts the second cycle when a certain percent of good items are left to him after the completion of regular production the retailer continues simultaneously two cycles up to which both types of the products are available to him now our objective is to find out optimal ordering lot size and optimal price for which the profit of the integrated model is maximum also we check the best strategy of retailer for the time of starting second cycle a numerical example is provided to illustrate the behavior and application of the model

note on economic production quantity model for items with imperfect quality a practical approach abstract in this note we present a simple approach for determining the economic production quantity for an item with imperfect quality we compare the results based on the simple approach with the optimal method for determining the lot size and show that almost optimal results are obtained using the simple approach

deterministic inventory model for deteriorating items with capacity constraint and time proportional backlogging rate in this paper a deterministic inventory model for deteriorating items with two warehouses is developed a rented warehouse is used when the ordering quantity exceeds the limited capacity of the owned warehouse and it is assumed that deterioration rates of items in the two warehouses may be different in addition we allow for shortages in the owned warehouse and assume that the backlogging demand rate is dependent on the duration of the stockout we obtain the condition when to rent the warehouse and provide simple solution procedures for finding the maximum total profit per unit time further we use a numerical example to illustrate the model and conclude the paper with suggestions for possible future research

reducing energy demand a review of issues challenges and approaches most commentators expect improved energy efficiency and reduced energy demand to provide the dominant contribution to tackling global climate change but at the global level the correlation between increased wealth and increased energy consumption is very strong and the impact of policies to reduce energy demand is both limited and contested different academic disciplines approach energy demand reduction in different ways emphasising some mechanisms and neglecting others being more or less optimistic about the potential for reducing energy demand and providing insights that are more or less useful for policymakers this article provides an overview of the main issues and challenges associated with energy demand reduction summarises how this challenge is framed by key academic disciplines indicates how these can provide complementary insights for policymakers and argues that a sociotechnical perspective can provide a deeper understanding of the nature of this challenge and the processes through which it can be achieved the article integrates ideas from the natural sciences economics psychology innovation studies and sociology but does not give equal weight to each it argues that reducing energy demand will prove more difficult than is commonly assumed and current approaches will be insufficient to deliver the transformation required

optimal production run length and warranty period for an imperfect production system under selling price dependent on warranty period abstract this paper extends the extant literature to consider that the selling price of the product sold with warranty policy is a function of the length of the warranty period for an imperfect production system a product under a free replacement repair warranty policy is considered and the lifetime distribution of the product is assumed to be exponentially distributed we seek to maximize the total profit per item through optimal determinations of the production run length and the warranty period based on the proposed mathematical model we will derive some lemmas and the propositions to carry out an efficient solution procedure to determine the optimal warranty period and production run length the numerical examples are given to illustrate the features of the proposed maximizing profit model and to show all of the possible cases of the solution procedure

uncertainties in future energy demand in uk residential heating fossil fuels are the main source of space heating in the uk and therefore climate mitigation implies a systemic change in space heating systems the challenge is difficult because of an inefficient building stock and high penetration of natural gas we present new quantified scenarios for residential energy use in the uk to 2050 with minimal policy intervention the uk will remain locked into a gas based heating system which would conflict with the policy goal of decarbonisation however there is a range of scenarios in which this is avoided a system heavily reliant on heat pumps powered by low carbon electricity is uk policy makers currently preferred alternative we conclude that some shift in this direction is likely to be required but complete reliance on this solution raises a number of problems greater use of energy efficiency and biomass can also play a significant role these options have different risks but a more diversified strategy would be more prudent we conclude that the future of uk residential space heating is very uncertain but meeting low carbon heating goals is better conceptualised as reducing reliance on gas rather than necessarily mass electrification our analysis has implications for any country with high use of fossil fuels in space heating and ambitious decarbonisation goals

an eoq model for perishable items under stock dependent selling rate and time dependent partial backlogging in the present paper we extend padmanabhan and vrat s model by proposing a time proportional backlogging rate to make the theory more applicable in practice the existence and uniqueness of the solutions of the relevant systems are examined subsequently a numerical example is presented to illustrate the application of developed model

blood inventory management an overview of theory and practice blood inventory management has attracted significant interest from the operations research profession during the last 15 years a number of methodological contributions have been made in the areas of inventory theory and combinatoric optimization that can be of use to other products or systems these contributions include the development of exact and approximate ordering and issuing policies for an inventory system the analysis of lifo or multi product systems and various forms of distribution scheduling in addition many of these results have been implemented either as decision rules for efficient blood management in a hospital or as decision support systems for hierarchical planning in a regional blood center in this paper we attempt a review of the recent operations research contributions to blood inventory management theory and practice whereas many problems have been solved others remain open and new ones keep being created with advances in medical technology and practices our approach is not to present an exhaustive review of all the literature in the field but rather to address several important issues from a unified perspective of theory and practice and point out new areas for further research

rational expectations and the aggregation of diverse information in laboratory security markets the idea that markets might aggregate and disseminate information and also resolve conflicts is central to the literature on decentralization hurwicz 1972 and rational expectations lucas 1972 we report on three series of experiments all of which were predicted to have performed identically by the theory of rational expectations in two of the three series one in which participants trade a complete set of arrow debreu securities and a second in which all participants have identical preferences double auction trading leads to efficient aggregation of diverse information and rational expectations equilibrium failure of the third series to exhibit such convergence demonstrates the importance of market institutions and trading instruments in achievement of equilibrium

information distortion in a supply chain the bullwhip effect this article originally appeared in management science april 1997 volume 43 number 4 pp 546 558 published by the institute of management sciences consider a series of companies in a supply chain each of whom orders from its immediate upstream member in this setting inbound orders from a downstream member serve as a valuable informational input to upstream production and inventory decisions this paper claims that the information transferred in the form of orders tends to be distorted and can misguide upstream members in their inventory and production decisions in particular the variance of orders may be larger than that of sales and distortion tends to increase as one moves upstream a phenomenon termed bullwhip effect this paper analyzes four sources of the bullwhip effect demand signal processing rationing game order batching and price variations actions that can be taken to mitigate the detrimental impact of this distortion are also discussed

an experiment on the efficiency of bilateral exchange under incomplete markets abstract we test in a controlled laboratory environment whether traders in a bilateral exchange internalize the impact of their actions on market prices better than in a large market in this model traders choose asset holdings constrained by a technology frontier next each trader experiences a random shock which makes only one type of asset profitable in a general equilibrium environment with incomplete markets this leads to pecuniary externalities because traders increase scarce asset holdings beyond what is socially optimal this behavior is especially exacerbated in large experimental markets as traders fail to internalize the impact of their actions on prices we find that when markets are incomplete a bilateral exchange can slightly mitigate the extent of pecuniary externalities and weakly increase welfare

information percolation in segmented markets we study equilibria of dynamic over the counter markets in which agents are distinguished by their preferences and information over time agents are privately informed by bids and offers investors differ with respect to information quality including initial information precision and also in terms of market connectivity the expected frequency of their bilateral trading opportunities we characterize endogenous information acquisition and show how learning externalities affect information gathering incentives more liquid markets lead to higher equilibrium information acquisition when the gains from trade and market duration are sufficiently large on the other hand for a small market duration the opposite may occur if agents vary sufficiently in terms of their market connectivity c 2014 published by elsevier inc

an eoq model with ramp type demand rate time dependent deterioration rate unit production cost and shortages an order level inventory system for deteriorating items has been developed with demand rate as a ramp type function of time the finite production rate is proportional to the demand rate and deterioration rate is time proportional the unit production cost is inversely proportional to the demand rate the model with no shortage case in inventory is first solved the inventory shortage is discussed next results are illustrated with two numerical examples for two models along with its sensitivity

joint economic lot size in distribution system with multiple shipment policy abstract this paper presents a new methodology to obtain the joint economic lot size in the case where multiple buyers are demanding one type of item from a single vendor the shipment policy is found and a new model is proposed to minimize the joint total relevant cost jtrc for both vendor and buyer s considering the two buyer and more than two buyer cases exact and approximate optimum solutions were obtained the benefits of the new model were illustrated in term of two different ratios production rate to demand rate and transportation cost to holding cost a sensitivity analysis was conducted to test the robustness of the new model

is more information always better experimental financial markets with cumulative information abstract we study the value of information in financial markets by asking whether having more information always leads to higher returns we address this question in an experiment where information about an asset s intrinsic value is cumulatively distributed among traders we find that only the very best informed traders i e insiders significantly outperform less informed traders however there is a wide range of information levels from zero information to above average information levels where additional information does not yield higher returns the latter result implies that the value of additional information need not be strictly positive

information revelation in a market with pairwise meetings the paper presents a simple pairwise meetings model of trade the new feature is that agents have asymmetric information about the true state of the world the focus is on the transmission of the information through the process of trade the qualitative question is to what extent is the information revealed to uninformed agents through the trading process when the market is in some sense frictionless in particular does the decentralized process give rise to full revelation results as derived by the literature on rational expectations for centralized and competitive environments in the context of the model of this paper it turns out that the information is not fully revealed to uninformed agents even when the market is in some sense approximately frictionless

analysis of the effect of various unit costs on the optimal incoming quantity in a perishable inventory model abstract in a previous paper we presented a periodic review perishable inventory model and showed how to compute the optimal incoming order quantity for a single period model with useful shelf lifetime of two periods and no backlogging on demand the incoming order quantities were computed as a function of the inventory on hand and on order for different demand distributions with different levels of demands and for lead times up to four periods this paper utilizes the same model and examines the effect of four unit costs ordering holding shortage and outdating costs on the optimal incoming quantity for the case of one period lead time

information percolation in large markets we introduce a simple model of the percolation of information of common interest through a large market as agents encounter each other over time and reveal information to each other some of which they may have received earlier from other agents we are particularly interested in the evolution over time of the cross sectional distribution in the population of the posterior probability assignments of the various agents we provide a market example based on privately held auctions and obtain a relatively explicit solution for the cross sectional distribution of posterior beliefs at each time our results contribute to the literature on information transmission in markets hayek 1945 argues that markets allow information that is dispersed in a population to be revealed through prices grossman s 1981 notion of a rational expectations equilibrium formalizes this idea in a setting with price taking agents milgrom 1981 pesendorfer and swinkels 1997 and reny and perry 2006 provide strategic foundations for the rational expectations equilibrium concept in centralized markets a number of important markets however are decentralized these include over the counter markets and private auction markets wolinsky 1990 and blouin and serrano 2002 study information transmission in decentralized markets in contrast to these two papers equilibrium behavior in our market example leads to full revelation of information we happily acknowledge conversations with manuel amador frank kelly jeremy stein and pierre olivier weill and research assistance from sergey lobanov rubinstein and wolinsky 1985 and gale 1986a 1986b study decentralized markets without asymmetric information satterthwaite and shneyerov 2003 study decentralized market with private value asymmetric information amador and weill 2006 study a more abstract setting regarding transmission of common and private i nformation

a survey of deterministic models for the eoq and epq with partial backordering models for the basic deterministic eoq or epq problem with partial backordering or backlogging make all the assumptions of the classic eoq or epq model with full backordering except that only a fraction of the demand during the stockout period is backordered in this survey we review deterministic models that have been developed over the past 40 years that address the basic models and extensions that add other considerations such as pricing perishable or deteriorating inventory time varying or stock dependent demand quantity discounts or multiple warehouses

game theory and empirical generalizations concerning competitive promotions this paper offers the generalization that competitive promotions are mixed strategies first an empirical regularity is established that promotions are independent across competitors this regularity is then elaborated on in the context of a promotion game the promotion game is linked to observable outcomes and a classification of possible situations is developed in particular the classification includes the prisoners dilemma battle of the sexes and marketing models of promotion competition the evidence for the generalization comes from a variety of product markets spanning trade promotions retail price reductions and retail promotions such as advertised specials the product markets include coffee baby diapers toilet tissue saltines dishwashing fluid ketchup and detergents among others the data in some cases were from cooperating grocery chains and in others from iri scanner panels the evidence from extant research and from new analyses is presented each situation is identified as be

corporate bond market transaction costs and transparency using a complete record of u s over the counter otc secondary trades in corporate bonds we estimate average transaction costs as a function of trade size for each bond that traded more than nine times between january 2003 and january 2005 we find that transaction costs decrease significantly with trade size highly rated bonds recently issued bonds and bonds close to maturity have lower transaction costs than do other bonds costs are lower for bonds with transparent trade prices and they drop when the trace system starts to publicly disseminate their prices the results suggest that public traders benefit significantly from price transparency

the effects of learning and forgetting on the optimal production lot size for deteriorating items with time varying demand and deterioration rates abstract in this paper we shall study the effects of learning and forgetting on the production lot size problems for an infinite planning horizon items deteriorate while they are in storage and both demand and deterioration rates are arbitrary functions of time the instantaneous production rate presented herein is dependent on the time required to produce the first unit at the beginning of production process the number of units remembered and the fixed learning slope component the forgetting slope is represented by an approximation of the minimum break to which the manufacturer assumes total forgetting so that it allows variable total forgetting breaks the system is subject to learning in the production stage and to forgetting while production ceased so that the optimal manufactured quantity for any given cycle is dependent on the instantaneous production rate a closed form for the total relevant costs is derived and rigorous mathematical methods that guide to a minimum total cost of the underlying inventory system are introduced illustrative examples which explain the applications of the theoretical results as well as their numerical verifications are also given

an inventory model for deteriorating items with stock dependent consumption rate and shortages under inflation and time discounting this paper derives an inventory model for deteriorating items with stock dependent consumption rate and shortages under inflation and time discounting over a finite planning horizon we show that the total cost function is convex with the convexity a simple solution algorithm is presented to determine the optimal order quantity and the optimal interval of the total cost function the results are discussed with a numerical example and particular cases of the model are discussed in brief a sensitivity analysis of the optimal solution with respect to the parameters of the system is carried out

limits and uncertainty for energy efficiency in the uk housing stock abstract the uk government s clean growth strategy unambiguously described the decarbonisation of heat as the uk s greatest policy and technical challenge in meeting our carbon targets maximising the potential for energy efficiency in the existing domestic stock is critical to the low carbon heat transition good information exists on the technical potential for energy efficiency measures in the uk stock however a lack of knowledge about current stock conditions and in use factors places considerable uncertainty on how much of this technical potential is achievable in practice this study uses data from the fifth carbon budget cb5 policy projections and updates the in use factors using measured data from the national energy efficiency database need this results in a 26 shortfall by 2035 in the anticipated energy savings through cavity solid wall and loft insulation compared to what is assumed in the cb5 projections this will have costly implications for meeting future carbon budgets risks and policy implications are discussed the practical potential for energy efficiency measures beyond cavity solid wall and loft insulation is explored

the deterministic eoq with partial backordering a new approach previous authors have shown that if demand that cannot be filled from stock is partially backordered then using the full backordering model or assuming that all stockouts will result in lost sales can lead to substantial increases in cost relative to using a model that specifically recognizes the percentage of the stockouts that will be backordered the models that these authors developed resulted in procedures or equations that are relatively difficult to use in this paper we take a different approach to modeling the deterministic eoq with partial backordering that results in equations that are more like the comparable equations for the basic eoq and its full backordering extension

optimal order quantity and selling price over a product life cycle with deterioration rate linked to expiration date it is evident that the lower the price the higher the demand therefore price is an important factor in a consumer s purchasing decision additionally for today s health conscious consumers product freshness is another important factor in purchasing decisions since product freshness declines over time today s health conscious consumers prefer a perishable product with a longer sell by date to a shorter one moreover a product s demand rate moving through its life cycle can be approximately represented by a trapezoid type pattern which includes constant demand increasing demand and decreasing demand as special cases in existing literature several researchers have developed inventory models for trapezoidal demand however they failed to consider pricing strategy product freshness linked to expiration date and purchasing cost in this study we enhance previous models by 1 taking pricing into consideration 2 exploring deterioration rate linked to expiration date and 3 adding an appropriate non constant purchasing cost we then derive theoretical results and run numerical examples to obtain managerial insights for instance the total profit without purchasing cost is significantly lower than that with purchasing cost included also if the cost of lost sales is improperly low then the total profit may become negative due to a large amount of lost sales

an inventory model with deteriorating items quantity discount pricing and time dependent partial backlogging abstract wee international journal of production economics 59 1999 511 in his interesting paper presented a deterministic inventory model with the following characteristics quantity discount schemes for the unit cost partial backlogging at a fixed rate deterioration of stock in time and demand rate being a linear function of the selling price in this article we generalize the work of wee 1999 more specifically we consider a model where the demand rate is a convex decreasing function of the selling price and the backlogging rate is a time dependent function which ensures that the rate of backlogged demand increases as the waiting time to the following replenishment point decreases

planning for shortages net present value analysis for a deteriorating item with partial backlogging abstract this paper develops inventory models to help answer strategic questions concerning whether planning for shortages offers financial benefits a production inventory system producing a deteriorating product in batches at a finite production rate with partial backordering is considered customers pay a deposit when placing a backorder backordered items receive a discount on the sales price as lost sales may lead to customers not returning the demand rate may depend on the fraction of lost sales we develop a cash flow based profit maximising net present value npv model without the inventory cost parameters commonly used in this context unit holding cost unit backorder cost unit deterioration cost and unit lost sales cost the model finds the optimal inventory policy just like npv models that discount the traditional parameters but has the advantage of not needing to estimate the value of the traditional parameters it is shown that in models based on discounting the traditional parameters the parameters are not exogenously determinable but are non trivial functions of non financial endogenous system parameters such as the production rate annual demand rate and backorder rate extensive numerical experiments illustrate how cash flow npv models provide insights into the value of planning for shortages and strategic choices about the design of the production inventory system it also provides insight into the classical problem of how to interpret unit backorder cost and unit lost sales cost the study indicates that these insights cannot be reliably obtained from npv models based on discounting unit backorder costs and unit lost sales costs

an eoq model with deteriorating items under inflation when supplier credits linked to order quantity abstract this study proposes an inventory model under a situation in which the supplier provides the purchaser a permissible delay of payments if the purchaser orders a large quantity shortages are not allowed and the effect of the inflation rate deterioration rate and delay in payment are discussed as well as a result in this paper we establish an eoq model for deteriorating items under inflation when the supplier offers a permissible delay to the purchaser if the order quantity is greater than or equal to a predetermined quantity we then characterize the optimal solution and provide an easy to use algorithm to find the optimal order quantity and replenishment time finally some numerical examples are given to illustrate the theoretical results and made the sensitivity analysis of parameters on the optimal solutions

experiments on percolation of information in dark markets in dark markets order submissions are bilateral and transaction prices are known only to the trading counterparties here we study to what extent the information aggregation theory proposed by duffie and collaborators predicts outcomes in a laboratory version of such markets we find that prices aggregate the available information but not in the strict sense of the theory where prices converge exponentially fast to average private signals prices instead fluctuate within bands around this average the band widths reflect in the best case the precision of the average signal and otherwise the precision of a single private signal