# Optimal Inventory Policy.

@article{Arrow1951OptimalIP, title={Optimal Inventory Policy.}, author={K. Arrow and T. Harris and J. Marschak}, journal={Econometrica}, year={1951}, volume={19}, pages={133} }

WE ipropose to outline a method for deriving optimal rules of inventory policy for finished goods. The problem of inventories exists not only for business enterprises but also for nonprofit agencies such as governmental establishments and their various branches. Moreover, the concept of inventories can be generalized so as to include not only goods but also disposable reserves of manpower as well as various stand-by devices. Also, while inventories of finished goods present the simplest problem… Expand

#### 820 Citations

An Inventory Policy for a Case of Lagged Delivery

- Economics
- 1956

In this paper we study the question which inventory policy is optimal in the presence of long delivery lags under otherwise simple conditions. The data on which the solution depends are the average… Expand

An Inclusive Solution to the Inventory Problem

- Mathematics
- 1961

This paper gives a unified approach to a set of inventory problems subsumed under the classical inventory problem proposed by Arrow, Harris, and Marschak. This set includes those problems with… Expand

Study on the Coordinating Policy of Multi-echelon Inventory System

- Computer Science
- 2019

It is proved obviously that the proper revenue sharing contract design is a useful coordinating tool to incentive the firms to choose actions which lead firms and total supply chain to global optimization as a result. Expand

Optimal Reorder Periods for an Inventory System with Variable Costs of Ordering

- Mathematics
- 1958

This paper discusses an inventory system in which the cost per order varies and is dependent on the number of different items listed on the order. The problem is to determine how frequently orders… Expand

Strategic Inventories under Limited Commitment

- Business
- 2017

In a dynamic storable good market where demand changes over time, we investigate the producer's strategic incentives to hold inventories in response to the possibility of buyer stockpiling. The… Expand

Strategic inventories under limited commitment

- Business
- 2019

In a dynamic storable good market where demand changes over time, we investigate the producer's strategic incentives to hold inventories in response to the possibility of buyer stockpiling. The… Expand

Decision Makings in Discount Pricing Policy for Imperfect Production System

- Economics, Mathematics
- 2018

This article deals with an imperfect production system in a enviornment of price discount with the partially backlogging at the beginning of the cycle. Here, demand is taken as price sensitive as a… Expand

TECHNICAL NOTE - Procurement Strategies with Unreliable Suppliers

- Business, Computer Science
- Oper. Res.
- 2011

A general periodic-review model in which the firm has access to a set of potential suppliers, each with specific yield and price characteristics, is proposed and analyzed, showing how the optimal procurement strategy can be obtained with an efficient algorithm. Expand

How Much Demand Should Be Fulfilled?

- Economics, Computer Science
- Oper. Res.
- 2010

A novel strategy is proposed, called the inventory-withholding strategy, to further explore the wait-list effect by making customers wait even when there is inventory on hand to satisfy them and it is shown that understocking is optimal in various scenarios. Expand

Vertical Control of Price and Inventory

- Economics
- 2007

This paper offers a simple approach to the theory of decentralizing inventory and pricing decisions along a supply chain. We consider an upstream manufacturer selling to two outlets, which compete as… Expand

#### References

SHOWING 1-10 OF 10 REFERENCES

The Coefficient of Resource Utilization

- Mathematics
- 1951

Abstract : A numerical evaluation of the 'dead loss' associated with a nonoptimal situation (in the Pareto sense) of an economic system is sought. Use is made of the intrinsic price systems… Expand

On the Application of Servomechanism Theory in the Study of Production Control

- Economics
- 1952

The problem of controlling the rate of production of a single product can be stated in terms of servomechanism theory, and the well-developed methods of that theory employed to study the behavior of… Expand

The Theory of Statistical Decision

- Computer Science
- 1951

The critical and philosophical remarks in this exposition may not accurately represent the views of Professor Wald, for both inwriting and lecturing, he prefers to be rather noncommittal on such points. Expand

On the Integral Equation of Renewal Theory

- Mathematics
- 1941

Feller’s paper is a rigorous treatment of renewal theory, and to assist the reader his principal results are summarized below in demographic form and notation.

A Class of Criteria for Decision-Making under Ignorance" (hectographed)

- Cowles Commission Discussion Paper, Statistics No
- 1951

GIRSHICK, [1] "Bayes and Minimax Solutions of Sequential Decision Problems," ECONOMETRICA, Vol

- JulyOctober,
- 1949

, [ 1 ] " An Exploration into the Use of Servomechanism Theory in the Study of Production Control " ( submitted for publication in EcONOMETRICA )

- Journal of the American Statistical Association

[ 1 ] " The Theory of Statistical Decision

- JURG , [ 1 ] " Zur Preisbildung bei Ungewissen Erwartungen , " Schweizerische Zeitschrift fuer Volkswirtschaft und Statistik