Supply chain with inventory review and dependent demand distributions: Dynamic inventory outsourcing

Konstantin Kogan, Sheldon Lou, Charles S. Tapiero, Matan Shnaiderman

Research output: Contribution to journalArticle

Abstract

In this paper, we consider inventory outsourcing by a producer to a distributor. The distributor charges a cost for each unit it handles and the manufacturer responds with a production and inventory policy over a finite contract period. As a result, the two parties enter a noncooperative differential game. We address the effect of information asymmetry in such a game under a stochastic demand when the inventory level can only be observed by the manufacturer intermittently.

Original languageEnglish (US)
Article number4745826
Pages (from-to)197-207
Number of pages11
JournalIEEE Transactions on Automation Science and Engineering
Volume7
Issue number2
DOIs
StatePublished - Apr 1 2010

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Keywords

  • Differential games
  • Dynamic programming/optimal control applications
  • Inventory/production policies

ASJC Scopus subject areas

  • Control and Systems Engineering
  • Electrical and Electronic Engineering

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