Optimal Production Policy in a Stochastic Manufacturing System

Yongjiang Guo () and Hanqin Zhang ()
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Yongjiang Guo: The Chinese Academy of Sciences
Hanqin Zhang: The Chinese Academy of Sciences

Chapter Chapter 8 in Stochastic Processes, Optimization, and Control Theory: Applications in Financial Engineering, Queueing Networks, and Manufacturing Systems, 2006, pp 141-157 from Springer

Abstract: Abstract This paper is concerned with the optimal production planning in a dynamic stochastic manufacturing system consisting of a single or parallel machines that are failure prone and facing a constant demand. The objective is to choose the production rate over time to minimize the long-run average cost of production and surplus. The analysis is developed by the infinitesimal perturbation approach. The infinitesimal perturbation analysis and identification algorithms are used to estimate the optimal threshold value. The asymptotically optimal threshold value and the convergence rate of the identification algorithms are obtained. Furthermore, the central limit theorem of the identification algorithms is also established.

Keywords: Manufacturing system; perturbation analysis; stochastic approximation; truncated Robbins-Monro algorithm (search for similar items in EconPapers)
Date: 2006
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Persistent link: https://EconPapers.repec.org/RePEc:spr:isochp:978-0-387-33815-6_8

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DOI: 10.1007/0-387-33815-2_8

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