Economic lot-sizing game with price-dependent demand

Xiaojie Yan, Juliang Zhang, Edwin Tai Chiu Cheng, Guowei Hua

Research output: Journal article publicationJournal articleAcademic researchpeer-review

Abstract

We study the economic lot-sizing (ELS) game with price-dependent demand, whereby several retailers form a coalition to jointly place orders to a single supplier and determine their sale prices over a multi-period finite time horizon for profit maximization. We show that the game is balanced and has a non-empty core in general. We also show that the game is convex in two special cases where the retailers' demand functions are the same and where the time horizon consists of two periods. We give a counter-example to demonstrate that the game is non-convex in general. We perform numerical experiments to show the benefits of cooperating on inventory replenishment.
Original languageEnglish
JournalEuropean Journal of Operational Research
DOIs
Publication statusAccepted/In press - 28 Jan 2016

Keywords

  • Balancedness
  • Core
  • Economic lot-sizing game
  • Logistics
  • Pricing

ASJC Scopus subject areas

  • Modelling and Simulation
  • Management Science and Operations Research
  • Information Systems and Management

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