Joint Inventory, Pricing, and Advertising Decisions with Surplus and Stockout Loss Aversions
Joint Authors
Cao, Bing-Bing
Fan, Zhi-Ping
Li, Hongyan
You, Tian-Hui
Source
Discrete Dynamics in Nature and Society
Issue
Vol. 2016, Issue 2016 (31 Dec. 2016), pp.1-14, 14 p.
Publisher
Hindawi Publishing Corporation
Publication Date
2016-06-05
Country of Publication
Egypt
No. of Pages
14
Main Subjects
Abstract EN
The newsvendor models considering decision-makers’ behavioral factors remain a fruitful research area in operation management field in past decade.
In this paper, we further extend the current literatures to look into joint inventory, pricing, and advertising decisions considering loss aversion effects under the newsvendor setting.
The purpose is to explore how the loss aversions affect the optimal policy of order quantity, price, and advertising effort level.
We present an integrated utility model to measure both economic payoff and loss aversion utility of the newsvendor, where surplus loss aversion and stockout loss aversion are first separately defined and quantified.
Then, we analyze the optimal solution conditions of the integrated model under exogenous and endogenous price cases, respectively.
Under exogenous price case, we find that the uniquely optimal policy exists and is presented in the closed form.
Under endogenous price case, the optimal policy is determined under mild conditions; we also provide the solutions when order quantity factor or advertising effort level is fixed in this case.
In addition, the sensitivity analysis shows that the loss aversions affect the optimal decisions of order quantity, price, and advertising effort level in a systematic way.
American Psychological Association (APA)
Cao, Bing-Bing& Fan, Zhi-Ping& Li, Hongyan& You, Tian-Hui. 2016. Joint Inventory, Pricing, and Advertising Decisions with Surplus and Stockout Loss Aversions. Discrete Dynamics in Nature and Society،Vol. 2016, no. 2016, pp.1-14.
https://search.emarefa.net/detail/BIM-1103340
Modern Language Association (MLA)
Cao, Bing-Bing…[et al.]. Joint Inventory, Pricing, and Advertising Decisions with Surplus and Stockout Loss Aversions. Discrete Dynamics in Nature and Society No. 2016 (2016), pp.1-14.
https://search.emarefa.net/detail/BIM-1103340
American Medical Association (AMA)
Cao, Bing-Bing& Fan, Zhi-Ping& Li, Hongyan& You, Tian-Hui. Joint Inventory, Pricing, and Advertising Decisions with Surplus and Stockout Loss Aversions. Discrete Dynamics in Nature and Society. 2016. Vol. 2016, no. 2016, pp.1-14.
https://search.emarefa.net/detail/BIM-1103340
Data Type
Journal Articles
Language
English
Notes
Includes bibliographical references
Record ID
BIM-1103340