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Monotone Forecasts

Author

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  • Çağrı Haksöz

    (Department of Information, Operations, and Management Sciences, Stern School of Business, New York University, New York, New York 10012)

  • Sridhar Seshadri

    (Department of Information, Operations, and Management Sciences, Stern School of Business, New York University, New York, New York 10012)

Abstract

In this paper we provide necessary and sufficient conditions for the distribution of demand in the future to be stochastically increasing in the demand that has been observed in the past. We base our analysis on the multiperiod inventory model examined by Eppen and Iyer (1997). In the process of establishing the necessary and sufficient conditions we develop a new property called the sequential monotone likelihood ratio property.

Suggested Citation

  • Çağrı Haksöz & Sridhar Seshadri, 2004. "Monotone Forecasts," Operations Research, INFORMS, vol. 52(3), pages 478-486, June.
    • Handle: RePEc:inm:oropre:v:52:y:2004:i:3:p:478-486
    DOI: 10.1287/opre.1030.0097
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    References listed on IDEAS

    as
    1. Katy S. Azoury, 1985. "Bayes Solution to Dynamic Inventory Models Under Unknown Demand Distribution," Management Science, INFORMS, vol. 31(9), pages 1150-1160, September.
    2. Hau L. Lee, 1996. "Effective Inventory and Service Management Through Product and Process Redesign," Operations Research, INFORMS, vol. 44(1), pages 151-159, February.
    3. Gary D. Eppen & Ananth. V. Iyer, 1997. "Improved Fashion Buying with Bayesian Updates," Operations Research, INFORMS, vol. 45(6), pages 805-819, December.
    4. Marshall Fisher & Ananth Raman, 1996. "Reducing the Cost of Demand Uncertainty Through Accurate Response to Early Sales," Operations Research, INFORMS, vol. 44(1), pages 87-99, February.
    5. Martin A. Lariviere & Evan L. Porteus, 1999. "Stalking Information: Bayesian Inventory Management with Unobserved Lost Sales," Management Science, INFORMS, vol. 45(3), pages 346-363, March.
    6. Donald L. Iglehart, 1964. "The Dynamic Inventory Problem with Unknown Demand Distribution," Management Science, INFORMS, vol. 10(3), pages 429-440, April.
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    Cited by:

    1. Ç Haksöz & S Seshadri, 2007. "Supply chain operations in the presence of a spot market: a review with discussion," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 58(11), pages 1412-1429, November.

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