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Markovian Decision Models for Reject Allowance Problems


  • Morton Klein

    (Columbia University)


Most manufacturing processes produce some defective items. To compensate for this, the total quantity produced in attempting to satisfy an order is larger than the order size. The excess is called a reject allowance. In this paper it is shown how the Markovian decision framework can be used to determine the amount to produce when production is, or can be, divided so that the products can be inspected before the production run is ended.

Suggested Citation

  • Morton Klein, 1966. "Markovian Decision Models for Reject Allowance Problems," Management Science, INFORMS, vol. 12(5), pages 349-358, January.
  • Handle: RePEc:inm:ormnsc:v:12:y:1966:i:5:p:349-358
    DOI: 10.1287/mnsc.12.5.349

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    Cited by:

    1. Grosfeld-Nir, Abraham, 1995. "Single bottleneck systems with proportional expected yields and rigid demand," European Journal of Operational Research, Elsevier, vol. 80(2), pages 297-307, January.
    2. Juhwen Hwang & Medini R. Singh, 1998. "Optimal Production Policies for Multi-Stage Systems with Setup Costs and Uncertain Capacities," Management Science, INFORMS, vol. 44(9), pages 1279-1294, September.
    3. Wang, Yunzeng & Gerchak, Yigal, 2000. "Input control in a batch production system with lead times, due dates and random yields," European Journal of Operational Research, Elsevier, vol. 126(2), pages 371-385, October.
    4. Liu, John J. & Yang, Ping, 1996. "Optimal lot-sizing in an imperfect production system with homogeneous reworkable jobs," European Journal of Operational Research, Elsevier, vol. 91(3), pages 517-527, June.

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