Bayesian acceptance sampling plans following economic criteria: An application to paper pulp manufacturing

Camino GonzALez and Gabriel Palomo

Journal of Applied Statistics, 2003, vol. 30, issue 3, 319-333

Abstract: The main purposes of this paper are to derive Bayesian acceptance sampling plans regarding the number of defects per unit of product, and to illustrate how to apply the methodology to the paper pulp industry. The sampling plans are obtained following an economic criterion: minimize the expected total cost of quality. It has been assumed that the number of defects per unit of product follows a Poisson distribution with process average 5 , whose prior information is described either for a gamma or for a non- informative distribution. The expected total cost of quality is composed of three independent components: inspection, acceptance and rejection. Both quadratic and step-loss functions have been used to quantify the cost incurred for the acceptance of a lot containing units with defects. Combining the prior information on 5 with the loss functions, four different sampling plans are obtained. When the quadratic-loss function is used, an analytical relation between the optimum settings of the sample size and the acceptance number is derived. The robustness analysis indicates that the sampling plans obtained are robust with respect to the prior distribution of the process average as well as to the misspecification of its mean and variance.

Date: 2003
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DOI: 10.1080/0266476022000030093

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