IDEAS home Printed from https://ideas.repec.org/a/inm/ormnsc/v25y1979i4p312-319.html
   My bibliography  Save this article

Learning Curves, Production Rate, and Program Costs

Author

Listed:
  • Norman Keith Womer

    (Air Force Institute of Technology)

Abstract

This paper deals with a model of the firm engaged in production to order. Models of this situation frequently conclude that the size of the order and production rate each influence the costs of production. Despite this fact, empirical work on production costs focus almost exclusively on either production rate or the size of the order as explainers of variations in costs. In this paper, a model is developed which is consistent with both these facts. The model permits production rate to be a decision variable in the manufacturer's production planning. The model is solved for an optimal production plan which requires production rate to change throughout the life of the program. The planning situation, where alternative order sizes are considered, is then contrasted with the production situation, where unit costs are related to cumulative output given a production plan. This approach provides guidance for the use of data on past programs in the estimation of cost functions and the evaluation of future production plans.

Suggested Citation

  • Norman Keith Womer, 1979. "Learning Curves, Production Rate, and Program Costs," Management Science, INFORMS, vol. 25(4), pages 312-319, April.
  • Handle: RePEc:inm:ormnsc:v:25:y:1979:i:4:p:312-319
    as

    Download full text from publisher

    File URL: http://dx.doi.org/10.1287/mnsc.25.4.312
    Download Restriction: no

    Citations

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


    Cited by:

    1. C. Lanier Benkard, 2000. "Learning and Forgetting: The Dynamics of Aircraft Production," American Economic Review, American Economic Association, vol. 90(4), pages 1034-1054, September.
    2. C. Lanier Benkard, 2000. "A Dynamic Analysis of the Market for Wide-Bodied Commercial Aircraft," NBER Working Papers 7710, National Bureau of Economic Research, Inc.
    3. Sengupta, Jati K., 2000. "Quality and efficiency," Economic Modelling, Elsevier, vol. 17(2), pages 195-207, April.
    4. Scott F. Rockart & Nilanjana Dutt, 2015. "The rate and potential of capability development trajectories," Strategic Management Journal, Wiley Blackwell, vol. 36(1), pages 53-75, January.
    5. Anelí Bongers, 2017. "Learning and Forgetting in the Jet Fighter Aircraft Industry," Working Papers 2017-02, Universidad de Málaga, Department of Economic Theory, Málaga Economic Theory Research Center.
    6. Womer, K. & Li, H. & Camm, J. & Osterman, C. & Radhakrishnan, R., 2017. "Learning and Bayesian updating in long cycle made-to-order (MTO) production," Omega, Elsevier, vol. 69(C), pages 29-42.
    7. Battaïa, Olga & Dolgui, Alexandre, 2013. "A taxonomy of line balancing problems and their solutionapproaches," International Journal of Production Economics, Elsevier, vol. 142(2), pages 259-277.
    8. C. Lanier Benkard, 1999. "Learning and Forgetting: The Dynamics of Aircraft Production," NBER Working Papers 7127, National Bureau of Economic Research, Inc.
    9. Li, Haitao & Womer, Keith, 2012. "Optimizing the supply chain configuration for make-to-order manufacturing," European Journal of Operational Research, Elsevier, vol. 221(1), pages 118-128.
    10. Benkard, C. Lanier, 2000. "A Dynamic Analysis of the Market for Wide-Bodied Commercial Aircraft," Research Papers 1636, Stanford University, Graduate School of Business.
    11. Nadeau, Marie-Claude & Kar, Ashish & Roth, Richard & Kirchain, Randolph, 2010. "A dynamic process-based cost modeling approach to understand learning effects in manufacturing," International Journal of Production Economics, Elsevier, vol. 128(1), pages 223-234, November.

    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:25:y:1979:i:4:p:312-319. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Mirko Janc). General contact details of provider: http://edirc.repec.org/data/inforea.html .

    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 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.

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

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.