Abstract

http://ssrn.com/abstract=1780444
 
 

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Inter-Temporal Inventory Competition and the Effects of Capacity Constraints


Konstantin Kogan


Bar-Ilan University - Interdisciplinary Department of Social Studies

Charles S. Tapiero


NYU Poly - Department of Finance and Risk Engineering

March 7, 2011

International Journal of Production Economics, Forthcoming

Abstract:     
This paper addresses an inter-temporal inventory competition between a supplier (a provider, manufacturer) and a retailer engaged in a supply chain. The paper’s focus is on the effect of capacity constraints on both parties when demands are seasonal. The paper provides a comparative study of two solution approaches, one is based on supply chain competition and the other is based on system-wide optimization. Our results demonstrate that with dynamic inventory competition, the retailer reduces inventory costs by reducing the response period to higher demands while increasing the supply requests compared to the system-wide optimal approach. As a result, the supplier’s inventory costs increase. An example illustrating these particular facets of the problem and its application is presented and discussed in light of the supplier and the retailer coordinating policies.

Number of Pages in PDF File: 7

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Date posted: March 8, 2011  

Suggested Citation

Kogan, Konstantin and Tapiero, Charles S., Inter-Temporal Inventory Competition and the Effects of Capacity Constraints (March 7, 2011). International Journal of Production Economics, Forthcoming. Available at SSRN: http://ssrn.com/abstract=1780444

Contact Information

Konstantin Kogan
Bar-Ilan University - Interdisciplinary Department of Social Studies ( email )
Ramat Gan, 52900
Israel
Charles S. Tapiero (Contact Author)
NYU Poly - Department of Finance and Risk Engineering ( email )
Brooklyn, NY 11201
United States
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References:  28

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