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The traditional economics and queueing literature typically assume that customers are fully rational. In contrast, in this paper, we study canonical service models with boundedly rational customers. We capture bounded rationality using a framework in which better decisions are made more often, while the best decision needs not always be made. We investigate(More)
We consider the optimal control of a production inventory-system with a single product and two customer classes where items are produced one unit at a time. Upon arrival, customer orders can be fulfilled from existing inventory, if there is any, backordered, or rejected. The two classes are differentiated by their backorder and lost sales costs. At each(More)
W e consider firms that feature their products on the Internet but take orders offline. Click and order data are disjoint on such non-transactional websites, and their matching is error-prone. Yet, their time separation may allow the firm to react and improve its tactical planning. We introduce a dynamic decision support model that augments the classic(More)
Motivated by the fast growing practice of web analytics, we study whether strategic customers are willing to click. Clicking reveals advance demand information which the firm can use to reduce demand-supply mis-match cost thereby increasing product availability to customers. Using newsvendor models that incorporate customers who anticipate that their clicks(More)
Probabilistic or opaque selling, whereby the seller hides the exact identity of the product until after the buyer makes the payment, has been used in practice and received considerable attention in the literature. Under what conditions, and why, is probabilistic selling attractive to firms? The extant literature has offered the following explanations: to(More)
C lick tracking is gaining in popularity, and the practice of web analytics is growing fast. Whether strategic customers are willing to visit a website when they know their clicks may be tracked is an important yet complex problem, which depends on various factors. Using a newsvendor framework, we examine this problem by focusing on the operational factor:(More)
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