|
Archive@NYU >
Stern School of Business >
IOMS: Operations Management Working Papers >
Please use this identifier to cite or link to this item:
http://hdl.handle.net/2451/26277
|
| Title: | Cost Allocation for Joint Replenishment Models |
| Authors: | Zhang, Jiawei |
| Keywords: | Cooperative Game
Joint Replenishment
Strong Duality |
| Issue Date: | Jul-2007 |
| Publisher: | Stern School of Business, New York University |
| Series/Report no.: | OM-2007-03 |
| Abstract: | We consider the one-warehouse multiple retailer inventory model with a
sub modular joint setup cost function. The objective of this model is to
determine an inventory replenishment policy that minimizes the long-run
average system cost over an infinite time horizon. Although the optimal
policy for this problem is still unknown, a class of easy-to-implement
power-of-two policies are 98% effective. This paper focuses on how the
cost, under an optimal power-of-two policy, should be allocated to the
retailers. This question generates an interesting cooperative game. We
prove that this cooperative game has a non-empty core. The key to our
result is a strong duality theorem for the one-warehouse multiple
retailer problem under power-of-two policies. |
| URI: | http://hdl.handle.net/2451/26277 |
| Appears in Collections: | IOMS: Operations Management Working Papers
|
All items in Faculty Digital Archive are protected by copyright, with all rights reserved.
|
