Approximate dynamic programming methods for an inventory allocation problem under uncertainty

Huseyin Topaloglu and Sumit Kunnumkal

Naval Research Logistics (NRL), 2006, vol. 53, issue 8, 822-841

Abstract: We propose two approximate dynamic programming methods to optimize the distribution operations of a company manufacturing a certain product at multiple production plants and shipping it to different customer locations for sale. We begin by formulating the problem as a dynamic program. Our first approximate dynamic programming method uses a linear approximation of the value function and computes the parameters of this approximation by using the linear programming representation of the dynamic program. Our second method relaxes the constraints that link the decisions for different production plants. Consequently, the dynamic program decomposes by the production plants. Computational experiments show that the proposed methods are computationally attractive, and in particular, the second method performs significantly better than standard benchmarks. © 2006 Wiley Periodicals, Inc. Naval Research Logistics, 2006

Date: 2006
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7)

Downloads: (external link)
https://doi.org/10.1002/nav.20164

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:wly:navres:v:53:y:2006:i:8:p:822-841

Access Statistics for this article

More articles in Naval Research Logistics (NRL) from John Wiley & Sons
Bibliographic data for series maintained by Wiley Content Delivery ().