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Properties of distributions with increasing failure rate

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  • Brusset, Xavier

Abstract

This paper solves the search for interior solutions to optimization problems using stochastic variables. This is done by way of some new properties of distribution functions with increasing failure rates as characterized in Barlow and Proschan (1965). Building upon Lariviere (2006), we show that an objective function of the type R(x) = F(x)+xF(x), where F(x) = 1-F(x), can also admit one interior maximal solution when the distribution function F has an increasing failure rate (IFR).

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File URL: http://mpra.ub.uni-muenchen.de/18299/
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Bibliographic Info

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 18299.

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Date of creation: 30 Oct 2009
Date of revision: 02 Nov 2009
Handle: RePEc:pra:mprapa:18299

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Keywords: optimization problem; probability distribution; increasing failure rate; objective function;

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  1. Martin A. Lariviere & Evan L. Porteus, 2001. "Selling to the Newsvendor: An Analysis of Price-Only Contracts," Manufacturing & Service Operations Management, INFORMS, vol. 3(4), pages 293-305, May.
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