IEEE Transactions on Automatic Control, Vol.61, No.10, 3058-3063, 2016
Inventory Control Over a Short Time Horizon Under Unknown Demand Distribution
We address inventory control by a manufacturer under stochastic customer demand over a finite time horizon when little is known about the demand. To handle the problem, we replace it with a deterministic differential game in which the manufacturer competes with the customer's demand. On the basis of the conjectural variation equilibrium of this game, we derive a heuristic for the original stochastic problem; conjectural variation is used as a tuning parameter for the heuristic.