We study a single-product single-location inventory system under periodic review, where excess demand is lost and the replenishment lead time is positive. The performance measure of interest is the long-run average holding cost and lost sales penalty cost. For a large class of demand...

This paper explores the connection between three important threads of economic research offering different approaches to studying the dynamics of an industry with heterogeneous firms. Finite models of the form pioneered by Ericson and Pakes (1995) capture the dynamics of a finite number of...

We characterize environmental quality as a stock, and its rate of deterioration as a flow. We consider a class of problems, which we call “SFQ” problems, in which both stocks and flows can be controlled to promote the quality of a resource stock. Abatement (curbing the flow) and restoration...

Oblivious equilibrium is a new solution concept for approximating Markov perfect equilibrium in dynamic models of imperfect competition among heterogeneous firms and has recently been used in multiple economic studies. In this paper, we present algorithms for computing oblivious equilibrium and...

We propose an approximation method for analyzing Ericson and Pakes (1995)-style dynamic models of imperfect competition. We develop a simple algorithm for computing an "oblivious equilibrium," in which each firm is assumed to make decisions based only on its own state and knowledge of the long...

We provide a generalization of Hoeffding's inequality to partial sums that are derived from a uniformly ergodic Markov chain. Our exponential inequality on the deviation of these sums from their expectation is particularly useful in situations where we require uniform control on the constants...