Application of the Cross-Entropy Method to the Buffer Allocation Problem in a Simulation-Based Environment

G. Alon, D. Kroese (), T. Raviv and R. Rubinstein

Annals of Operations Research, 2005, vol. 134, issue 1, 137-151

Abstract: The buffer allocation problem (BAP) is a well-known difficult problem in the design of production lines. We present a stochastic algorithm for solving the BAP, based on the cross-entropy method, a new paradigm for stochastic optimization. The algorithm involves the following iterative steps: (a) the generation of buffer allocations according to a certain random mechanism, followed by (b) the modification of this mechanism on the basis of cross-entropy minimization. Through various numerical experiments we demonstrate the efficiency of the proposed algorithm and show that the method can quickly generate (near-)optimal buffer allocations for fairly large production lines. Copyright Springer Science + Business Media, Inc. 2005

Keywords: buffer allocation; cross-entropy method; stochastic optimization; production lines (search for similar items in EconPapers)
Date: 2005
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DOI: 10.1007/s10479-005-5728-8

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