We study a repeated newsvendor game with transshipments. In every period n retailers face a stochastic demand for an identical product and independently place their inventory orders before demand realization. After observing the actual demand, each retailer decides how much of her leftover inventory or unsatisfied demand she wants to share with the other retailers. Residual inventories are then...

We analyze an extension of the classical multi-period, single-item, linear cost inventory problem where the objective function is a coherent risk measure. Properties of coherent risk measures allow us to offer a unifying treatment of risk averse and min–max type formulations. For the single period newsvendor problem, we show that the structure of the optimal solution of the risk averse model is...

We propose an approach to the classical newsvendor problem and its extensions subject to uncertain demand that: (a) works directly with data, i.e., combines historical data and optimization in a single framework, (b) yields robust solutions and incorporates risk preferences using one scalar parameter, rather than utility functions, (c) allows for tractable formulations, specifically, linear pro...

Price of anarchy, the performance ratio, which could characterize the loss of efficiency of the distributed supply chain management compared with the integrated supply chain management is discussed by utilizing newsvendor problem in single period which is well-known. In particular, some of remarkable distributed policies are handled, the performance ratios in each case which have been investiga...

We present a unified and tractable framework for distributionally robust optimization that could encompass a variety of statistical information including, among others things, constraints on expectation, conditional expectation, and disjoint confidence sets with uncertain probabilities defined by φ-divergence. In particular, we also show that the Wasserstein-based ambiguity set has an equivalen...

This paper examines a dynamic version of the newsboy problem in which a decision maker must maintain service capacity from several sources to attempt to meet uncertain demand for a perishable good, subject to the cost of providing sufficient capacity, and penalties for not meeting demand. A complete characterization of the optimal outcome is obtained when normalized demand is modeled as Brownia...

The price-setting newsvendor problem, which models the economic trade-offs associated with uncertain demand of a perishable product, is fundamental to supply chain analysis. However, in settings such as agriculture, there is significant economic risk associated with supply uncertainty. We analyze how risk aversion and the source of uncertainty—demand and/or supply—affect tractability and optima...

In the classical newsboy problem, no cost is assumed if the ordered quantity is less than the demand. However, in reality failure to meet demand is always associated with a penalty. The aim of this work is to extend the analysis of the distribution-free newsboy problem to the case when shortage cost is taken into consideration. The analysis is based on the assumption that only the mean and vari...