Based on a dynamic model of the stochastic repayment behavior exhibited by delinquent credit-card accounts as a self-exciting point process, a bank can control the arrival intensity of repayments using costly account-treatment actions. A semi-analytic solution to the corresponding stochastic...

Many decision problems exhibit structural properties in the sense that the objective function is a composition of different component functions that can be identified using empirical data. We consider the approximation of such objective functions, subject to general monotonicity constraints on...

We argue that dynamic pricing motivated by the management of inventory holding and ordering costs leads to increased operational efficiencies which could benefit firms without hurting consumers. To demonstrate this point, we equip the traditional economic order quantity (EOQ) setting with a rich...

We propose a simple explanation for price rigidity in perishable groceries: inventory record inaccuracy (IRI). We build our argument in two steps. First, we tailor Gallego and Van Ryzin’s (1994) revenue management model to perishable groceries by adding an inventory waste process,...

We present a continuous-time stochastic formulation of the standard Economic Order Quantity (EOQ) model incorporating all major costs incurred in carrying a product, including the cost of restocking, the cost of auditing the shelf stock level, the opportunity cost of capital, the cost of loss...

Problem definition. We present a continuous-time Bayesian model for managing inventory in a retail setting when inventory records are inaccurate. In our formulation, the inventory level and its record have separate dynamics. The former is driven by the demand and unobservable loss process while...