A Comparison of the Optimal Ordering Levels of Bayesian and Non-Bayesian Inventory Models

摘要

Although it is often the case that the parameters of the distribution of demand are not known with certainty and that a Bayesian formulation would be appropriate, such an approach is generally not used in inventory calculations for computational reasons. Since one often resorts to a non-Bayesian formulation, it is of interest to compare Bayesian policies with a comparable non-Bayesian policy. It was anticipated that the non-Bayesian policy (quantity ordered) would be an upper bound to the Bayesian policy. This result is established for a two-period standard inventory model and for the n-period non-depletive inventory model. However, a counterexample is given in the standard inventory model for an alternative comparable non-Bayesian formulation. (Author)