Joint pricing and ordering policies for deteriorating item with retail price-dependent demand in response to announced supply price increase

[[abstract]]Recently, due to rapid economic development in emerging nations, the world's raw material prices have been rising. In today's unrestricted information environment, suppliers typically announce impending supply price increases at specific times. This allows retailers to replenish their stock at the present price, before the price increase takes effect. The supplier, however, will generally offer only limited quantities prior to the price increase, so as to avoid excessive orders. The retail price will usually reflect any supply price increases, as market demand is dependent on retail price. This paper considers deteriorating items and investigates (1) the possible effects of a supply price increase on retail pricing, and (2) ordering policies under the conditions that special order quantities are limited and demand is dependent on retail price. The purpose of this paper is to determine the optimal special order quantity and retail price to maximize profit. Our theoretical analysis examines the necessary and sufficient conditions for an optimal solution, and an algorithm is established to obtain the optimal solution. Furthermore, several numerical examples are given to illustrate the developed model and the solution procedure. Finally, a sensitivity analysis is conducted on the optimal solutions with respect to major parameters.[[incitationindex]]SCI[[booktype]]紙

Impact of future price increase on ordering policies for deteriorating items under quadratic demand

When a supplier announces a price increase at a certain time in the future, for each retailer it is important to choose whether to purchase supplementary stock to take benefit of the current lower price or procure at a new price. This article focuses on the possible effects of price increase on a retailer's replenishment strategy for constant deterioration of items. Here, quadratic demand is debated; which is appropriate for the products for which demand increases initially and subsequently it starts to decrease with the new version of the substitute. We discuss two scenarios in this study: (I) when the special order time coincides with the retailer's replenishment time and (II) when the special order time falls during the retailer's sales period. We determine an optimal ordering policy for each case by maximizing total cost savings between special and regular orders during the depletion time of the special order quantity. Scenarios are established and illustrated with numerical examples. Through, sensitivity analysis important inventory parameters are classified. Graphical results, in two and three dimensions, are exhibited with supervisory decision

Budget Deficits and Inflation: A Theoretical and Empirical Survey

Japan's fiscal position is deteriorating continuously, and some argue that a debt write-off through managed inflation will be inevitable if public debt is to increase at the present pace. This article will first examine if inflation is an inevitable component of the attempt to solve the current government debt problem by looking at the history of debt reduction in other countries. Next, it will evaluate the economic theory on the interdependence between fiscal and monetary policies in light of the historical experience of inflation. In so doing, it finds that the gold standard imposed discipline on both fiscal and monetary policies while under the floating exchange rate regime budget institutions and the central bank system served as a guidepost to economic policy-making as an alternative to the gold standard. Based upon these theoretical historical and institutional findings, it will conclude by reflecting on the ways in which the experience of other countries can be useful for evaluating Japan's situation.

Sustainable Inventory Management Model for High-Volume Material with Limited Storage Space under Stochastic Demand and Supply

Inventory management and control has become an important management function, which is vital in ensuring the efficiency and profitability of a company’s operations. Hence, several research studies attempted to develop models to be used to minimise the quantities of excess inventory, in order to reduce their associated costs without compromising both operational efficiency and customers’ needs. The Economic Order Quantity (EOQ) model is one of the most used of these models; however, this model has a number of limiting assumptions, which led to the development of a number of extensions for this model to increase its applicability to the modern-day business environment. Therefore, in this research study, a sustainable inventory management model is developed based on the EOQ concept to optimise the ordering and storage of large-volume inventory, which deteriorates over time, with limited storage space, such as steel, under stochastic demand, supply and backorders. Two control systems were developed and tested in this research study in order to select the most robust system: an open-loop system, based on direct control through which five different time series for each stochastic variable were generated, before an attempt to optimise the average profit was conducted; and a closed-loop system, which uses a neural network, depicting the different business and economic conditions associated with the steel manufacturing industry, to generate the optimal control parameters for each week across the entire planning horizon. A sensitivity analysis proved that the closed-loop neural network control system was more accurate in depicting real-life business conditions, and more robust in optimising the inventory management process for a large-volume, deteriorating item. Moreover, due to its advantages over other techniques, a meta-heuristic Particle Swarm Optimisation (PSO) algorithm was used to solve this model. This model is implemented throughout the research in the case of a steel manufacturing factory under different operational and extreme economic scenarios. As a result of the case study, the developed model proved its robustness and accuracy in managing the inventory of such a unique industry

Food Price Policy in Indonesia

Agricultural and Food Policy,

Measures of investor and consumer confidence and policy actions in the current crisis

The current financial crisis has highlighted the danger that declines in confidence can have a self-fulfilling effect on economic activity. In this paper, the authors consider ways of measuring investor and consumer confidence, and try to explain the evolution of confidence using measures of financial volatility, investment performance, macroeconomic outcomes, and policy actions. They identify a link between investor and consumer confidence. Finally, they show that liquidity provision and easing of interest rates had only a limited effect on financial market spreads during the crisis, arguing for additional measures to address the loss of confidence. The paper focuses on the need for financial regulatory reform, and shows how the incentives to cooperate in this area are stimulated by a common shock to confidence.Debt Markets,Emerging Markets,,Currencies and Exchange Rates,Banks&Banking Reform

Integrating Food Policy with Growing Health and Wellness Concerns: An Analytical Literature Review of the Issues Affecting Government, Industry, and Civil Society

Over the past few years, there has been growing global interest in the link between food and health. This paper provides a review of some of the recent literature describing these linkages. The first section provides an overview of findings that link the consumption of fruits and vegetables, meat, eggs, whole-grains, alcohol, sugar, dairy, fish, pulses, soy, and nuts to coronary heart disease, cancer, stroke, and diabetes. The authors then summarize various international and domestic non-government organizations' views about these issues. The third section centres on the food industry and its responses to growing health concerns. The fourth section is an overview of public policy relating to food and health, including the use of food policy to change consumption behaviour and address obesity. This section also includes a discussion of the relevance of policies designed to discourage smoking to the current debate on obesity. The Conclusion highlights ways in which Canadian food policy can be adapted in order to better promote health and wellness.Food Consumption/Nutrition/Food Safety, Health Economics and Policy, Agribusiness,

Policy Responses to External Shocks: The Experiences of Australia, Brazil and Chile

Open economies, particularly emerging markets and commodity-intensive economies, deal with large external shocks. Interestingly enough, policy reactions and policy set-ups may dampen or amplify the consequences of these shocks, affecting the magnitude of the shock. This paper revisits the recent experience of policy frameworks and reactions in three countries: Australia, Brazil and Chile. In particular, we analyse and evaluate alternative policy set-ups and policy reactions to the Asian crisis in the period 1997-98, and to the lower world growth and higher risk aversion in 2001-2002.