bluuebunny/crossref_metadata_2025 huggingface dataset:
A Model of Technology Selection by Cost Minimizing Producers
Authors: Boyd Dean W. , Phillips Robert L. , Regulinski Stephan G.
Published: November 2008

A set of microeconomic assumptions are presented that lead to a model of the technology choices made by producers of a homogenous energy product. Under these assumptions it is possible to model the technology selection decision as being made solely to minimize product cost. Since the cost of producing energy using a particular technology will be different for different producers, a number of technologies will be adopted in the market rather than a single, “least-cost” technology.
A Simulation Analysis of Tour-Shift Construction Procedures
Authors: Mabert Vincent A. , Watts Charles A.
Published: November 2008

Work force scheduling research over the last few years has concentrated on the shift scheduling problem in service oriented firms (telephone operators, postal employees, bank encoders, etc.). In all cases, the authors were primarily interested in the evaluating procedures (optimal and heuristic) to determine the appropriate number of workers to be assigned to the available set of work schedules to meet fluctuating work volumes. However, more attention should be given to how the available shift schedules were defined (start times, durations, etc.) and their impact on maintaining good productivity levels. This paper analyzes the impact of six different approaches in defining the available weekly tour-shift schedules. Tests are conducted to evaluate the performance of the six approaches using operating data from Ohio National Bank for the check proof and encoding activity.

The results of this study provide some useful managerial insights into the issues of effectively staffing personnel on a weekly basis. First, restrictive employment policies/customs can substantially increase costs. Second, structured procedures can be used to identify and build good employment schedules for a weekly assignment. And third, the structured procedures presented here provide useful cost and productivity information for evaluating various staffing decisions, and weighing these decisions with other intangible factors such as employee morale and turnover.
Using Simulation for Leadership and Management Research: Through the Looking Glass
Authors: McCall Morgan W. , Lombardo Michael M.
Published: November 2008

A case might be made that we have not learned very much about leadership in complex organizations. One factor contributing to this lack might be the narrowness of the traditional approach to leadership. By defining leadership as an interpersonal influence process, a research literature has been generated that focuses almost exclusively on leader-subordinate relationships, two or so styles, and group outcomes. Such a focus does not ask questions about the environmental and organizational context of leadership and the impacts it may have.

A second factor contributing to narrowness might be an overdependence on one methodology for studying leadership, namely the survey. One might argue that direct observation, or at least multiple methodologies, could be usefully applied to understanding leadership.

It was with these conceptual and methodological concerns in mind that a simulation was designed for use in leadership research. Its goals were both simple and complex: to mirror as realistically as possible the demands of a typical managerial job, to have real managers run the simulated company however they chose, and to bring a full methodological arsenal to bear on learning something new about leadership. By watching managers cope with the problems and challenges of organizational life, we hoped to come up with some better questions to guide future research.

This paper uses Looking Glass, Inc. (a person-centered simulation of management in a complex organization) as an example of how simulation can be used to examine research questions that are designed-in, phenomena that occur because the complexity of real organizations was preserved, and possible research interventions. The nature of this simulation also permits the use of an unusual number of research methods, and these are outlined. The paper concludes by addressing three major questions of the simulation: Is it valid? Is it practical? Is it a game?
Confidence Intervals for Steady-State Simulations II: A Survey of Sequential Procedures
Authors: Law Averill M. , Kelton W. David
Published: November 2008

We continue our survey of methods for constructing confidence intervals for steady-state means via simulation by studying sequential procedures which determine the length of the simulation during the course of the run. Our goal is to provide the simulation practitioner with some guidance as to which published procedures might actually perform well in practice. Empirical results for a variety of stochastic models with known steady-state means suggest that sequential procedures by Fishman and by Law and Carson provide good performance relative to the criterion probability of coverage.
Note—On MRP Lot Sizing
Authors: McClain John O. , Maxwell William L. , Muckstadt John A. , Thomas L. Joseph , Weiss Elliott N.
Published: November 2008

In this Note we present an alternative formulation to the MRP lot sizing model of Steinberg and Napier (SN) (Steinberg, E., H. A. Napier. 1980. Optimal multi-level lot sizing for requirements planning systems. Management Sci. 26 (2) 1258–1271.). The alternative is more parsimonious and the notation less cumbersome. We also point out several errors in the formulation of the SN model which are significant for future research.
Learning, Experimentation, and the Optimal Output Decisions of a Competitive Firm
Authors: Harpaz Giora , Lee Wayne Y. , Winkler Robert L.
Published: November 2008

This paper considers the effect of learning from experience on the output decisions of a perfectly competitive firm faced with the demand uncertainty. Specifically, a Bayesian framework for expectations formation and demand forecasting by a perfectly competitive firm is presented. Focusing the analysis on the determination of optimal sequential output decisions, it is shown that through output experimentation, the experimenting firm will select a non-myopic sequential policy and will tend to overproduce. The exact magnitude of the overproduction and the economic value of experimentation are contingent upon model parameters and the length of the planning horizon.
Short Term Financial Planning under Uncertainty
Authors: Kallberg J. G. , White R. W. , Ziemba W. T.
Published: November 2008

This paper presents a stochastic linear programming formulation of a firm's short term financial planning problem. This framework allows a more realistic representation of the uncertainties fundamental to this problem than previous models. In addition, using Wets's algorithm for linear simple recourse problems, this formulation has approximately the same computational complexity as the mean approximation (i.e., the deterministic program obtained by replacing all random elements by their means). Using this formulation we empirically investigate the effects of differing distributions and penalty costs. We conclude that even with symmetric penalty costs and distributions the mean model is significantly inferior to the stochastic linear programming formulation. Thus we are able to demonstrate that ignoring the stochastic components in linear programming formulations can be very costly without having significant computational savings.
Predicting Demand for Residential Solar Heating: An Attribute Method
Authors: Berkowitz M. K. , Haines G. H.
Published: November 2008

This paper presents two models which allow long run demand for a new product to be estimated prior to any significant sales history. The specific product studied is residential solar heating in Canada. Both models are based on the concept that consumers react in their purchasing decisions to the inherent package of characteristics in a commodity. The use of survey information to enable specific numerical estimates to be made is exemplified. Directions for future research to improve the usefulness of such models are suggested.
On Optimal Allocation in a Distributed Processing Environment
Authors: Dutta Amitava , Koehler Gary , Whinston Andrew
Published: November 2008

Distributed processing has been motivated by many objectives. Among these are a desire to share resources, reduce communications costs (as compared to a centralized processing scheme), increase performance and decrease response time by partitioning tasks and achieve higher system availability (fault tolerance). Typically, processes (tasks) within a single processor and across processors will communicate among themselves in such a distributed environment. It is desirable to be able to assign tasks to processors in some optimal manner. In this paper, a quadratic partitioning model is developed to represent this interaction of tasks in a distributed processing environment. Initially, no capacity constraints are considered at any processor. An optimal solution (in a probabilistic sense) is found for this uncapacitated problem using a probabilistic branch and bound technique. Capacity constraints for processors are then introduced. Three intuitively appealing heuristics are developed to obtain good, though not necessarily optimal, solutions to the capacitated problem.
The Shapley Value as Aircraft Landing Fees–Revisited
Authors: Dubey Pradeep
Published: November 2008

We examine the axiomatic basis of the Shapley value when applied to the problem of allocating the cost of a runway among different-sized users. Our approach is to begin with a model of airport-problems and then to list—within the model—certain natural properties which an allocation ought to satisfy. It is shown that these lead uniquely to the Shapley value.
On the Reswitching Property of R&D
Authors: Lee Tom K.
Published: November 2008

Existing theoretical models of research and development (R&D) treat R&D as a single economic activity. Once R&D terminates, the only way for the activity to resume is by assuming some exogenous changes in the basic parameters of the model, e.g., the distribution of technological advances. In contrast, this paper treats R&D as two unique but dependent economic activities.

A sequential R&D search model is developed to establish three fundamental results. First, reswitching of R&D is endogenized. Success in development may bring research back as the next optimal choice of action. It is shown that the reswitching phenomenon of the dynamic process of R&D is a result of optimal decision making.

Second, when the economic returns based on existing production technology are low compared to what is potentially feasible, the immediate returns to development are high. Thus development is preferable to research. As the level of economic returns increases due to development success, the likelihood of further development success diminishes. Research will then be a better choice relative to development. However, if development is very successful, research will not significantly improve the likelihood of future development success. In that event one might as well capitalize on existing knowledge and continue to develop until the technology field is economically exploited.

Third, the choice of a discount rate for R&D will affect the overall decision of R&D vs. stopping. However, the effect on the decision to research or to develop remains to be determined.
Sources of Bias in Assessment Procedures for Utility Functions
Authors: Hershey John C. , Kunreuther Howard C. , Schoemaker Paul J. H.
Published: November 2008

Utility functions are an important component of normative decision analysis, in that they characterize the nature of people's risk-taking attitudes. In this paper we examine various factors that make it difficult to speak of the utility function for a given person. Similarly we show that it is questionable to pool risk-propensity data across studies (for descriptive purposes) that differ in the elicitation methods employed.

The following five sources of bias or indeterminacy are hypothesized and demonstrated. First, certainty equivalence methods generally yield greater risk-seeking than probability equivalence methods. Second, the probability and outcome levels used in reference lotteries induce systematic bias. Third, combining gain and loss domains yields different utility measures than separate examinations of the two domains. Fourth, whether a risk is assumed or transferred away exerts a significant influence on people's preferences in ways counter to expected utility theory. Finally, context or framing differences strongly affect choice in a nonnormative manner.

The above five factors are first discussed as essential choices to be made by the decision scientist in constructing Von Neumann-Morgenstern utility functions. Next, each is examined separately in view of existing literature, and demonstrated via experiments. The emerging picture is that basic preferences under uncertainty exhibit serious incompatibilities with traditional expected utility theory. An important implication of this paper is to commence development of a systematic theory of utility encoding which incorporates the many information processing effects that influence people's expressed risk preferences.
Multicommodity Network Flows with Probabilistic Losses
Authors: Aneja Y. P. , Nair K. P. K.
Published: November 2008

This paper considers the problem of maximizing the expected value of multicommodity flows in a network in which the arcs experience probabilistic loss rates. Consideration of probabilistic losses are relevant, particularly, in communication and transportation networks. An arc-chain formulation of the problem and an efficient algorithm for computing an optimal solution are provided. The algorithm involves a modified column generation technique for identifying a constrained chain. Computational experience with the algorithm is included.
Erratum to “Innovation Diffusion in a Dynamic Potential Adopter Population”
Authors: Mahajan Vijay , Peterson Robert A.
Published: November 2008

Erratum to Mahajan, Vijay, Robert A. Peterson. 1978. Innovation diffusion in a dynamic potential adopter population. Management Sci. 24 (15) 1589–1597.
Theory, Models and Implementation in Financial Management
Authors: McInnes J. Morris , Carleton Willard J.
Published: November 2008

A theory of corporate financial management is summarized from the broad flow of finance literature. Within this, contributions to a normative theory, amenable to corporate financial modeling, are reviewed in some detail. The central propositions of a normative theory are isolated to provide a basis of comparison for the practice of financial modeling, as observed through a field research study. Differences between theory and practice are identified and discussed.

Compared with the experience of ten years ago, computer-based financial modeling systems are today gaining much greater acceptance in business organizations. Despite this, a wide gap seems to exist between the information and logic structures programmed into financial models, and the precepts and algorithms derived from a normative theory of corporate financial management.

Implementation difficulties in three main, but interdependent, areas are identified as causing the gap between theory and practice. First, there is the difficulty of constructing relevant information in a form which would be meaningful in a normative framework. Within the braod set of managerial activities of an organization, there are several relevant logic structures, including: a financial accounting structure; an economic structure dealing with cash flow, economic value, and marginal rates of return to investment: operating information structures dealing with the conduct of an organization's work; and strategic information structures dealing with an assessment of the external and internal human needs which provide a rationale for an organization's present and future existence. The systematic provision of information in each logical mode, and the translation between modes, poses a considerable intellectual and practical challenge. Then there is the problem of dealing satisfactorily with strategic uncertainty, and the way that uncertainty is distributed within the managerial organization. Finally, multiple and conflicting goal dimensions pose considerable problems in terms of an explicit modeling of a corporate objective function. Beyond the intellectual difficulties, moreover, there are political dimensions which cause a reluctance to address an objective function explicitly and directly.

Normative finance theory provides a powerful logic for designing information and decision-making structures to support corporate planning. At present, however, the research reported in this survey paper suggests that the finance model is incomplete, particularly with regard to inclusion of behavioral and political dimensions of organizational processes under uncertainty. Finally, the reader should be forewarned that the literatures referenced in this survey are somewhat disjoint, involving different concepts, language and paradigms. This means that the paper's jargon level to most readers will remain high, even after the authors' attempts to minimize it.
Optimal Sequential Investment Decisions Under Conditions of Uncertainty
Authors: Prastacos Gregory P.
Published: November 2008

This paper presents a mathematical model of sequential investment behavior under conditions of uncertainty. The model addresses the problem of an investor with access to a limited pool of capital, who makes sequential decisions on long-lasting investments, under uncertainty as to the timing or the quality of future opportunities. We derive optimal investment strategies for the cases where the return from investment is a convex or concave function, we present closed form solutions for commonly adopted return functions, and we evaluate how the optimal investment behavior should change when changes occur in the environment, or the underlying probability distributions. In addition, we analyze three modifications of the problem.

The results presented in this paper extend previous results on investment behavior for long-lasting (irreversible) decisions; in addition, some results are in accordance with existing ones from portfolio theory and/or search theory.
An Axiomatic Approach to Expert Resolution
Authors: Morris Peter A.
Published: November 2008

This paper proposes a set of axioms for combining expert probability assessments. The axioms provide a framework for understanding previous results, and are used to derive a new method for combining event probabilities from different sources into a single estimate.
Organizational Life Cycles and Shifting Criteria of Effectiveness: Some Preliminary Evidence
Authors: Quinn Robert E. , Cameron Kim
Published: November 2008

This paper discusses the relationships between stage of development in organizational life cycles and organizational effectiveness. We begin the paper by reviewing nine models of organizational life cycles that have been proposed in the literature. Each of these models identifies certain characteristics that typify organizations in different stages of development. A summary model of life cycle stages is derived that integrates each of these nine models.

Next, a framework of organizational effectiveness developed by Quinn and Rohrbaugh is introduced. This framework organizes criteria of effectiveness into four models—rational goal, open systems, human relations, and internal processes models. We hypothesize that certain of the models are important in evaluating the effectiveness of organizations in particular life cycle stages but not in others. The analysis of a state agency's development over five years provides some evidence to support these hypothesized relationships between life cycle stages and criteria of effectiveness.

We conclude that major criteria of effectiveness change in predictable ways as organizations develop through their life cycles. Some shifts in state of development are resisted by the organization much more than are others, and intervention into organizations may be needed to help make the transitions less painful and costly. We also discuss why the predictions of contingency theory often are not substantiated by research because the responses of organizations to the external environment vary in different life cycle stages.
Methods for the Evaluation of Permutations as Strategies in Stochastic Scheduling Problems
Authors: Glazebrook K. D.
Published: November 2008

A collection of stochastic jobs is to be processed by a single machine in a manner which is consistent with a precedence relation on the job set. Costs are incurred as jobs are processed and rewards are earned when they complete. The problem of finding optimal processing strategies is in general very complex. However, algorithms exist which in many cases yield the strategies which are optimal among those which are simply permutations of the job set. In light of this, the question of how well permutations perform as strategies is an important one. We present methods which aim to answer this question. They are based on earlier results by Glazebrook.
A Numerical Method to Obtain the Equilibrium Results for the Multiple Finite Source Priority Queueing Model
Authors: Chandra M. Jeya , Sargent Robert G.
Published: November 2008

In this paper a numerical method is presented to obtain the equilibrium results of the multiple finite source queueing model having a single server using a nonpreemptive fixed priority service discipline and where each class of customers has a different exponential interarrival density function and arbitrary service time distribution function. This solution method uses the method of imbedded Markov Chain and the renewal reward theorem to find the proportion of time the server is busy with the customers of different classes. The equilibrium results are then related to these proportions using an extension of Little's formula.
A Recursive Kalman Filter Forecasting Approach
Authors: Kahl Douglas R. , Ledolter Johannes
Published: November 2008

This paper examines the forecasting accuracy and the cost effectiveness of time series models with time-varying coefficients. A simulation study investigates the potential forecasting benefits of a proposed Kalman filter type adaptive estimation and forecasting approach. It is found that: When appropriate, the time-varying coefficient approach leads to better forecasts than the constant coefficient procedures. A simple decision rule, which indicates whether time-varying coefficient models are in fact needed, increases the computational efficiency.
Erratum to “Reliability and Inventory in a Production-Storage System”
Authors: Meyer Robert R. , Rothkopf Michael H. , Smith Stephen A.
Published: November 2008

Erratum to “Reliability and Inventory in a Production-Storage System”, Management Sci. 25 (8) (1979) 799–807.
Ranking in Tournaments and Group Decisionmaking
Authors: Goddard Stephen T.
Published: November 2008

This paper fully discusses methods for ranking a set of alternatives in the fairest possible way according to a minimum violations criterion. New methods, based on finding paths and circuits in graphs, are presented for ranking participants in round-robin and generalized tournaments, and for consensus and group decisionmaking problems. The objective of the paper is to review existing methods for tackling these problems, and compare them with the new methods, according to a “fairness” criterion, and the amount of computing required to reach a solution. It is shown that the new methods often exceed the existing methods in both fairness and reduced computing requirements. In particular, the new methods are generally more versatile than existing methods. This allows organizations to obtain the fairest ranking of a number of alternatives, according to their managers' or employees' wishes. Particular attention is given to incomplete rankings where insufficient exposure of an individual to some alternatives restricts that individual to ranking only the remaining alternatives.
Aggregation in Manpower Planning
Authors: Wijngaard J.
Published: November 2008

In manpower planning, as in all other kinds of planning, an important choice is the level of aggregation. The proper level of aggregation depends on the flexibility (mobility) of the personnel. This dependency is investigated in this paper. The manpower system considered is characterized by two dimensions, level and function group. Conditions are derived for aggregate long-term planning (aggregation over function group) combined with one-period disaggregation being optimal.
Note—Optimal Long-Run Equilibrium Advertising Level for the Blattberg-Jeuland Model
Authors: Sethi Suresh P.
Published: November 2008

The purpose of this note is to formulate and solve a dynamic optimization problem based on the Blattberg-Jeuland advertising model. Also examined is the behavior of the optimal long-run equilibrium level of advertising with respect to changes in some important parameters of the problem. In particular, a new interesting result, showing that the equilibrium optimal level of advertising for the B-J model is a nonmonotone function of the rate of decay parameter, is derived. That is, the equilibrium optimal level of advertising is an increasing function of the rate of decay for smaller rates of decay and a decreasing function for larger rates of decay than a critical rate of decay. This phenomenon is analogous to a sink effect and is intuitively appealing. It is also shown that the equilibrium optimal level of advertising is a decreasing function of the insertion cost and discount rate parameters. Finally, the framework presented in this note is also useful in analyzing further extensions of the problem solved here.
Project Appraisal Methodology: Market Penetration Elements
Authors: Silverman Barry G.
Published: November 2008

This paper describes a multiple competing technologies market penetration model which incorporates multiple attributes rather than strictly price into the market share allocation function. The model which is linear and deterministic was developed in response to the sponsor's request for a simplified technological forecasting procedure. Its principal features include (a) a static nominal market share function based on multi-attribute scaling and maximum market fractions and (b) an effective market share function dependent on market potential forecasts, nominal market share, and a penetration delay curve. The model offers significant spatial, sectoral, and temporal resolution and may readily incorporate professional judgment (it is best implemented in a buyer-behavior survey mode). A version of the model is applied to the advanced energy combustion technology market in support of a DOE budget preparation exercise. Three sets of participants—program advocates, independent review panel, and system integrators—interacted in a series of solutions, defenses, and re-solutions of the model which permitted professional judgment and expert opinion to be solicited and incorporated in a systematic fashion. Model results indicate zero to very little penetration for several of the proposed projects. Parametrics reveal that results are most sensitive to (a) moderate shifts in commercialization date, (b) small changes in market growth rates (for technological penetrating expansion markets only), and (c) shifts in static market share curve coefficients.
A Diverting Structure's Effects on a River Flow Time Series
Authors: Downing Darryl J. , Pack David J. , Westley Gary W.
Published: November 2008

A step-by-step summary of an empirical time series analysis of the effects of a newly constructed dam on river flow rate is given. A model of river flow rate for the 522 weeks of data is built through the transfer function/intervention model development processes of Box-Jenkins/Box-Tiao. Analysis indicates a rainfall variable has a significant influence on the pre-dam flow rate but not on the post-dam flow rate. The model also reflects a differing relationship of rainfall to pre-dam flow rate depending on the season of the year. Physical interpretations of model parameters and determination of implied mean flow rates suggest that the final model provides a sound basis for some public policy decisions that might focus on the dam.
Connectedness in Multiple Linear Fractional Programming
Authors: Choo E. U. , Atkins D. R.
Published: November 2008

The geometric properties of the sets of efficient and weakly efficient solutions of multiple linear fractional programming problems are investigated. Weakly efficient solutions are path-connected by finitely many linear line segments when the constrained region is compact.
Sequential Analysis of the Stay/Leave Decision: U.S. Air Force Officers
Authors: Gotz Glenn A. , McCall John J.
Published: November 2008

This paper develops a model to study the stay/leave decisions of Air Force officers. The model includes the most important institutional factors affecting an officer's career: promotion probabilities and timing, regular force integration probabilities, and mandatory separation and retirement probabilities. The model considers the officer's income for each potential combination of future grade and year of service and his civilian income opportunities. The model studies the incentives to retire for the current nondisability retirement system and the recent proposal by the President's Commission on Military Compensation. Numerical results are presented using actual data from Fiscal Year 1970 for nonrated officers who entered the Air Force through ROTC. On average, the officers' stay/leave behavior conforms with the model's predictions.

Dynamic programming is the methodology used to construct the stay/leave model. Two versions of the dynamic programming model are considered. First, a sequential decision model for a risk-neutral agent is developed. The second version of the dynamic programming model generalizes the risk-neutral case to encompass risk-aversion. A functional equation is developed in which there is temporal resolution of uncertainty with respect to both military and civilian incomes.
Note—Modelling the Effect of Decreased Food Intake on the Activity Pattern of an Individual
Authors: Gorsky Robin D.
Published: November 2008

The effect of decreases in food energy intake on the activity pattern of an individual may be described by an Mx/M/1 queueing model. λ represents the rate of activity arrival to the system. E(k) represents the average energy level at which the system performs, μ represents the rate at which the system processes energy units. p0 = 1 − λE(k)/μ represents the probability of an idle system, of the system at rest. The model was validated by collecting data on food energy intake and activities from ten healthy young men. When food energy intake decreased an average of 500 kcal/day, 1 − p0, the probability of a nonidle system, decreased from 0.431 to 0.413, p < 0.005. The greatest parameter change occurred in λ, which decreased from 0.245 to 0.235, p < 0.001. Thus, when food energy intake decreases, the activity pattern of an individual as represented by a queueing system changes: more time is spent at rest; less time is spent in moving activities.
Note—A Note on “Efficiency of the Antithetic Variate Method for Simulating Stochastic Networks”
Authors: Grant Floyd H.
Published: November 2008

In a recent paper by Sullivan, Hayya, and Schaul (Sullivan, R. S., J. C. Hayya, R. Schaul. 1982. Efficiency of the antithetic variate method for simulating stochastic networks. Management Sci. 28 (5, May) 563–572.), they present a theorem which proves that negative covariance will be guaranteed, and thus a variance reduction achieved, when estimating the project completion time in PERT networks using antithetic sampling procedures. Their proof is restricted to stochastic networks in which the arc time distributions are symmetric about their means. In this note we present a proof which guarantees a variance reduction for arbitrary arc time distributions.
Erratum to “Firm's Forecasts of Engineering Employment”
Authors: Brach Peter , Mansfield Edwin
Published: November 2008

Erratum to “Firm's Forecasts of Engineering Employment” by Peter Brach and Edwin Mansfield, Management Sci. 28 (2, February) (1982) 156–160.
Filtering: An Approach to Generating the Information Base for Collective Choice
Authors: Abonyi George
Published: November 2008

Nonmarket resource allocation decisions require some means for generating information on relevant preferences. This is part of the role of a collective choice process. Implicit in the optimization techniques central to MS/OR is the assumption that makes collective choice equivalent to the optimization of a social preference function. This paper proposes an alternative approach to collective choice, called “filtering,” and compares it with the general optimization approach. Though not foreclosing the use of optimization techniques, filtering represents a fundamental departure from the perspective on collective choice implicit in these techniques. The fundamental advantage of filtering is that it increases the likelihood of collective agreement on specific plans, while minimizing the strategic use of misinformation. The general logic of filtering may be implemented via a variety of interactive methods. The information generated can contribute to more stable and implementable plans. Filtering responds to a societal context characterized more by diversity of interests than uniformity, and as much concerned with the possible adverse consequences of plans proposed by “experts” as with their promised benefits. The more modest objective of collective choice supported by filtering is to identify collectively acceptable plans for interdependent social groups whose goals and preferences may not be fully known. This supports the need for participation by relevant interests in the planning process. In general, filtering provides a framework for “joint charting” of the future collaboratively, by aiming at the evolution of a “reasonable consensus” from a base of what may appear initially to be “unreasonable vetoes.”
An Algorithm to Calculate the Return Distribution of Portfolios with Option Positions
Authors: Bookstaber Richard , Clarke Roger
Published: November 2008

The use of options in altering the return distribution of stock portfolios has found increasing interest among investment managers. The potential of options in forming portfolio return distributions that are more consistent with investor preferences has been well developed, but determining the actual effect of options on portfolio returns remains a complex and unsolved problem. The purpose of this paper is to describe an algorithm for determining the return distribution that will result when option positions are taken on stocks in a portfolio. The distribution is determined for a finite time horizon, and does not rely on the assumption of continuous portfolio revisions. Simulation tests on the algorithm are also discussed. The algorithm is then used to illustrate the effect that several simple and well-known options strategies will have on portfolio return characteristics. This algorithm will be of practical value, giving a technique for generating and analyzing the expanded opportunity set that exists by using options in portfolio management.
An Analysis of Air Force EOQ Data with an Application to Reorder Point Calculation
Authors: Mitchell C. R. , Rappold R. A. , Faulkner W. B.
Published: November 2008

One of the important uses of an EOQ item's distribution of lead time demand is to set its reorder point. This paper shows that a realistic model of observed demand patterns can be chosen from the compound Poisson family of distributions. Actual historical data from several U.S. Air Force bases are analyzed using the geometric-Poisson and constant-Poisson distributions. The control discipline is order quantity, reorder point with continuous review. The service level is based on percent of demand supplied during lead time and is consistent with current USAF methodology. The reorder point is based on independent calculations and no attempt is made to jointly optimize the order quantity and reorder point. Lead time is assumed to be known and constant.
The Demand for Engineers—Projections Through 1987
Authors: Landis Fred , Svestka Joseph A.
Published: November 2008

Engineering manpower constitutes an important national resource where demand and supply must be in reasonable balance to assure continued economic growth. The paper establishes a demand analysis to predict the need for engineers in 15 industry groups through 1987, subject to various economic scenarios. It is shown that for total engineering employment in any industry segment the constant dollar gross national product fraction per engineer is only a slowly varying function of time. A least-square fit of this ratio versus time is shown to be an adequate predictor of employment and can be used for extrapolation with confidence. A parallel analysis is also developed for engineers employed in research and development.

It is shown that, in general, the need for new engineers due to economic growth is smaller than the need to make up for attrition due to death, retirement, promotions out of engineering and voluntary leaving of the profession. The high mobility rate of engineers out of the profession is significant and its importance has not previously been documented.

The paper concludes with a preliminary discussion of the balance between supply and demand. Even with a healthy economic growth the nation is likely to produce a small excess of engineering graduates over the near future. However, there will be a shortage of engineers holding advanced degrees for entry into research and development, even if R&D sees only a moderate growth. Better industry-university cooperation is called for to encourage engineers to undertake advanced degrees, to assess actual future needs and to advise students to select appropriate engineering disciplines.
Note—Note on “Optimal Ordering Quantity to Realize a Pre-Determined Level of Profit”
Authors: Sankarasubramanian E. , Kumaraswamy S.
Published: November 2008

In this note we consider the one-period inventory model in which it is required to determine the order quantity which maximizes the probability of realizing a predetermined level of profit R. We give a condition for determining the optimal order quantity and provide explicit expressions for the optimal order quantity in three special cases.
Cognitive Style as a Basis for MIS and DSS Designs: Much ADO About Nothing?
Authors: Huber George P.
Published: November 2008

It is commonly believed that the user's cognitive style should be considered in the design of Management Information Systems and Decision Support Systems. In contrast, an examination of the literature and a consideration of some of the broader issues involved in MIS and DSS design lead to the conclusions that: (1) the currently available literature on cognitive style is an unsatisfactory basis for deriving operational design guidelines, and (2) further cognitive style research is unlikely to provide a satisfactory body of knowledge from which to derive such guidelines. The article presents six specific bases for these two conclusions.

From a manager's pespective, the outcome of the study is a suggestion: maintain a healthy skepticism if it is suggested that paper and pencil assessments of the user's cognitive style should be used as a basis for MIS or DSS designs. From a researcher's viewpoint, the study raises two questions: (1) If our research interest is MIS and DSS design, does it seem that further research in cognitive style is a wise allocation of our research resources? (2) If our research interest is cognitive style, does it seem that the use of cognitive style as a basis for MIS and DSS designs will become an important application area?
Erratum To “Economic Design of np Charts for Processes Subject to a Multiplicity of Assignable Causes” By Wing-Kin Chiu
Authors: Peters Michael H.
Published: November 2008

Erratum To “Economic Design of np Charts for Processes Subject to a Multiplicity of Assignable Causes” By Wing-Kin Chiu, Management Sci. 23 (4, December) (1976).
Human Diagnostic Reasoning by Computer: An Illustration from Financial Analysis
Authors: Bouwman Marinus J.
Published: November 2008

A major complaint of people who use “decision-making” computer programs is that these programs merely provide a final decision, and fail to present the supporting argumentation, in terms the user can understand. This article presents an approach that makes computer programs more “human-like” by basing them on human decision making behavior.

Decision making processes of student financial analysts are captured by asking them to think aloud during their evaluation. These verbal traces, called protocols, are analyzed at various levels of detail, resulting in specific models of the decision making processes involved, the strategies used, and the task-specific (financial) knowledge that is required to perform the task. The models and strategies are translated into executable computer programs. Extensive comparisons between human behavior and model simulation output are provided, assessing the extent that the computer program “thinks” and “talks” like a human decision maker. Although the model clearly suffers from “linguistic rigidity,” it does appear to perform the evaluation in a similar manner as the human decision maker, examining the same information in the same order, making the same inferences, and reporting the same conclusions.
Multivariate Stratified Sampling by Optimization
Authors: Mulvey John M.
Published: November 2008

An important, recurring problem in statistics involves the determination of strata boundaries for use in stratified sampling. This paper describes a practical method for stratifying a population of observations based on optimal cluster analysis. The goal of stratification is constructing a partition such that observations within a stratum are homogeneous as defined by within-cluster variances for attributes that are deemed important, while observations between strata are heterogeneous. The problem is defined as a deterministic optimization model with integer variables and is solved by means of a subgradient method. Computational tests with several examples show that the within-strata variances and thus the accompanying standard errors can be substantially reduced. Since the proposed model strives to minimize standard error, it is applicable to situations where a precise sample is essential, for example, microeconomic simulation studies.
The Effect of Workload Dependent Due-Dates on Job Shop Performance
Authors: Bertrand J. W. M.
Published: November 2008

This study explores the due-date performance of job shop control systems which base job due dates on a time-phased representation of the workload and the machine capacity in the shop. The performance is measured by the mean and the standard deviation of the lateness. Two parameters are used to vary the functioning of the due-date assignment system: a minimum allowance for waiting, denoted by SL, and a maximum fraction of the available capacity allowed for loading, denoted by CLL. The system increases the waiting lime allowance if congestion is observed when loading a new job. The capability of the system to observe congestion is determined by the parameters CLL and SL.

Simulation experiments are used to investigate the performance of the assignment system. It is shown that the assignment system performs quite well with respect to reducing the standard deviation of the lateness; the performance is not very sensitive however to the parameter values used; with an expected capacity utilization of 90%, CLL should be set between 0.80 and 1.00 times the mean available capacity and SL should be set between 0.55 and 0.90 times the mean operation waiting time in the shop.

The assignment system may also perform well with respect to controlling the mean lateness. If SL is set between 0.55 and 0.75 times the mean expected waiting time in the shop, a constant mean lateness is obtained independent of the utilization of the shop if CLL is set between 0.70 and 0.80 times of the mean available capacity. However, the mean lateness turns out to be quite sensitive to variations in the job-mix of the workload. Finally it is shown that if the values of the assignment parameters are adequate, the mean job lateness is independent of the number of operations in a job. This property can be used to monitor the correctness of the parameter values.
Achieving a Confidence Interval for Parameters Estimated by Simulation
Authors: Adam Nabil R.
Published: November 2008

This paper presents a procedure for determining the number of simulation observations required to achieve a preassigned confidence interval for means estimated by simulation. This procedure, which is simple to implement and efficient to use, is compared with two other methods for determining the required sample size in a simulation run. The empirical results show that this procedure gives good results in the precision of estimated means and in sample size requirement.
An Injury Threshold Model for Two-Car Collisions
Authors: Krishnan K. S. , Carnahan James V. , Beckmann Martin J.
Published: November 2008

A theoretical model which estimates the probability of injury to occupants of vehicles in two-car collisions is presented and evaluated. This model is based on considerations of principles from mechanics and observations from biomechanics. It is evaluated using two-car accident injury data.

The validity of the model structure is supported because the differences between estimated numbers of injuries and observed numbers of injuries in two-car accidents were statistically insignificant. In contrast, the predictive accuracy was found to be unacceptable for three regression models from the published literature which were arbitrarily specified. The parameter estimates developed for the model provide a basis for tentatively evaluating the effect of vehicle size on the probability of injury to drivers of cars in two-car collisions.
Optimal Strategies for Selling an Asset
Authors: Rosenfield Donald B. , Shapiro Roy D. , Butler David A.
Published: November 2008

This paper considers the problem of selling an asset on the open market. The seller receives a random sequence of price offers, which may arrive either periodically or randomly over time. After each offer is received, the seller must decide whether or not to sell, weighing the possibility of obtaining a better offer against the cost of waiting. A number of authors have established the properties of optimal selling policies when the distribution of offers is known and offers are received periodically. This paper investigates the conditions under which these same properties hold for an unknown offer distribution which is updated as successive offers are received.
An Algorithmic Solution to Two-Stage Transfer Lines with Possible Scrapping of Units
Authors: Shanthikumar J. G. , Tien C. C.
Published: November 2008

An important aspect of the efficient design of an automatic transfer line is the ability to understand and predict the effects of the system parameters such as the size of the intermediate buffer storage space, the cycle times, failure times, repair times, and scrap rate, on the production rate of the transfer line. In this paper we develop an efficient algorithm to compute the production rate of a two-stage transfer line for different system parameters. The algorithm is developed assuming that the failure and repair times are geometrically distributed and that the units may be scrapped with a certain probability when the machine processing it fails. Using this algorithm, extensive numerical results are obtained. Based on these numerical results, the behavior of the transfer line is discussed and some interesting observations are reported which would be useful in the design of automatic transform lines.