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Optimal Policies for a Multi-Echelon Inventory Problem

Clark, Andrew J., Scarf, Herbert·1960·Management Science

Abstract

In the last several years there have been a number of papers discussing optimal policies for the inventory problem. Almost without exception these papers are devoted to the determination of optimal purchasing quantities at a single installation faced with some pattern of demand. It has been customary to make the assumption that when the installation in question requests a shipment of stock, this shipment will be delivered in a fixed or perhaps random length of time, but at any rate with a time lag which is independent of the size of the order placed. There are, however, a number of situations met in practice in which this assumption is not a tenable one. An important example arises when there are several installations, say 1, 2, …, N, with installation 1 receiving stock from 2, with 2 receiving stock from 3, etc. In this example, if an order is placed by installation 1 for stock from installation 2, the length of time for delivery of this stock is determined not only by the natural lead time between these two sites, but also by the availability of stock at the second installation. In this paper we shall consider the problem of determining optimal purchasing quantities in a multi-installation model of this type.

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Metadata

Authors
Clark, A. J., & Scarf, H.
Venue
Management Science
Published
1960-07
Volume
6
Issue
4
Pages
475-490
ISSN
  • 0025-1909 (ISSN-L)
  • 1526-5501
OpenAlex
W4252999557
Cited by
1,252
References
0
FWCI
2.56
Type
journal article
Language
en
Open access
closed

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CoChat. (2026). Citation check: Optimal Policies for a Multi-Echelon Inventory Problem. https://app.cochat.ai/papers/10.1287/mnsc.6.4.475
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Clark, A. J., & Scarf, H. (1960). Optimal Policies for a Multi-Echelon Inventory Problem. Management Science. https://doi.org/10.1287/mnsc.6.4.475

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