IDEAS home Printed from https://ideas.repec.org/a/inm/ormnsc/v11y1965i7p690-723.html
   My bibliography  Save this article

An Empirical Study of Exactly and Approximately Optimal Inventory Policies

Author

Listed:
  • Harvey M. Wagner

    (Stanford University)

  • Michael O'Hagan

    (Stanford University)

  • Bertil Lundh

    (Stanford University)

Abstract

The (s, S) inventory model (infinite horizon with stationary parameters) is explored with a view toward determining the dependency of the optimal policy on the model's parameters and toward evaluating the effectiveness of several numerical approximation methods for obtaining nearly optimal policies. The mode of attack is empirical: We compare the results for 828 cases, which encompass several values for each of the economic parameters, three delivery lags, and three distinct demand probability distributions with varying parameter values. We demonstrate for these cases that close to optimal results can be obtained by applying the Fibonacci search procedure, by using a particular asymptotic approximation, as well as by substituting a certain policy not of the (s, S) form.

Suggested Citation

  • Harvey M. Wagner & Michael O'Hagan & Bertil Lundh, 1965. "An Empirical Study of Exactly and Approximately Optimal Inventory Policies," Management Science, INFORMS, vol. 11(7), pages 690-723, May.
    • Handle: RePEc:inm:ormnsc:v:11:y:1965:i:7:p:690-723
    DOI: 10.1287/mnsc.11.7.690
    as

    Download full text from publisher

    File URL: http://dx.doi.org/10.1287/mnsc.11.7.690
    Download Restriction: no
    File URL: https://libkey.io/10.1287/mnsc.11.7.690?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Hu, Jason & Watson, Edward & Schneider, Helmut, 2005. "Approximate solutions for multi-location inventory systems with transshipments," International Journal of Production Economics, Elsevier, vol. 97(1), pages 31-43, July.
    2. Sean X. Zhou & Chaolin Yang, 2016. "Continuous-Review ( R, nQ ) Policies for Inventory Systems with Dual Delivery Modes," Operations Research, INFORMS, vol. 64(6), pages 1302-1319, December.
    3. K. Jeganathan & M. Abdul Reiyas & S. Selvakumar & N. Anbazhagan & S. Amutha & Gyanendra Prasad Joshi & Duckjoong Jeon & Changho Seo, 2022. "Markovian Demands on Two Commodity Inventory System with Queue-Dependent Services and an Optional Retrial Facility," Mathematics, MDPI, vol. 10(12), pages 1-22, June.
    4. Saif, Ahmed & Elhedhli, Samir, 2016. "Cold supply chain design with environmental considerations: A simulation-optimization approach," European Journal of Operational Research, Elsevier, vol. 251(1), pages 274-287.
    5. Lagodimos, A.G. & Christou, I.T. & Skouri, K., 2012. "Computing globally optimal (s,S,T) inventory policies," Omega, Elsevier, vol. 40(5), pages 660-671.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:inm:ormnsc:v:11:y:1965:i:7:p:690-723. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Asher (email available below). General contact details of provider: https://edirc.repec.org/data/inforea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.