Table of Contents Author Guidelines Submit a Manuscript
Mathematical Problems in Engineering
Volume 2017, Article ID 6810415, 9 pages
https://doi.org/10.1155/2017/6810415
Research Article

Mathematical Modeling for Risk Averse Firm Facing Loss Averse Customer’s Stochastic Uncertainty

College of Business Administration, Hongik University, Seoul, Republic of Korea

Correspondence should be addressed to Jinpyo Lee; rk.ca.kignoh@eel.oypnij

Received 24 January 2017; Revised 18 March 2017; Accepted 26 March 2017; Published 11 April 2017

Academic Editor: Huanqing Wang

Copyright © 2017 Seungbeom Kim et al. This is an open access article distributed under the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.

Linked References

  1. W. Elmaghraby and P. Keskinocak, “Dynamic pricing in the presence of inventory considerations: research overview, current practices, and future directions,” Management Science, vol. 49, no. 10, pp. 1287–1309, 2003. View at Publisher · View at Google Scholar · View at Scopus
  2. X. Chen, M. Sim, D. Simchi-Levi, and P. Sun, “Risk aversion in inventory management,” Operations Research, vol. 55, no. 5, pp. 828–842, 2007. View at Publisher · View at Google Scholar · View at Zentralblatt MATH · View at Scopus
  3. D. Kahneman and A. Tversky, “Prospect theory: an analysis of decision under risk,” Econometrica, vol. 47, no. 2, pp. 263–291, 1979. View at Publisher · View at Google Scholar
  4. B. G. Hardie, E. J. Johnson, and P. S. Fader, “Modeling loss aversion and reference dependence effects on brand choice,” Marketing Science, vol. 12, no. 4, pp. 378–394, 1993. View at Publisher · View at Google Scholar
  5. N. C. Petruzzi and M. Dada, “Pricing and the newsvendor problem: a review with extensions,” Operations Research, vol. 47, no. 2, pp. 183–194, 1999. View at Publisher · View at Google Scholar · View at Scopus
  6. A. Federgruen and A. Heching, “Combined pricing and inventory control under uncertainty,” Operations Research, vol. 47, no. 3, pp. 454–475, 1999. View at Publisher · View at Google Scholar · View at MathSciNet · View at Scopus
  7. A. Federgruen and A. Heching, “Multilocation combined pricing and inventory control,” Manufacturing and Service Operations Management, vol. 4, no. 4, pp. 275–295, 2002. View at Publisher · View at Google Scholar · View at Scopus
  8. X. Chen and D. Simchi-Levi, “Coordinating inventory control and pricing strategies with random demand and fixed ordering cost: the infinite horizon case,” Mathematics of Operations Research, vol. 29, no. 3, pp. 698–723, 2004. View at Publisher · View at Google Scholar · View at MathSciNet · View at Scopus
  9. X. Chen and D. Simchi-Levi, “Coordinating inventory control and pricing strategies with random demand and fixed ordering cost: the finite horizon case,” Operations Research, vol. 52, no. 6, pp. 887–896, 2004. View at Publisher · View at Google Scholar · View at MathSciNet · View at Scopus
  10. M. E. Schweitzer and G. P. Cachon, “Decision bias in the newsvendor problem with a known demand distribution: experimental evidence,” Management Science, vol. 46, no. 3, pp. 404–420, 2000. View at Publisher · View at Google Scholar · View at Zentralblatt MATH · View at Scopus
  11. T.-H. Ho, N. Lim, and T. H. Cui, “Reference dependence in multilocation newsvendor models: a structural analysis,” Management Science, vol. 56, no. 11, pp. 1891–1910, 2010. View at Publisher · View at Google Scholar · View at Scopus
  12. B. L. Fredrickson and D. Kahneman, “Duration neglect in retrospective evaluations of affective episodes,” Journal of Personality and Social Psychology, vol. 65, no. 1, pp. 45–55, 1993. View at Publisher · View at Google Scholar · View at Scopus
  13. D. Kuksov and K. Wang, “The bright side of loss aversion in dynamic and competitive markets,” Marketing Science, vol. 33, no. 5, pp. 693–711, 2014. View at Publisher · View at Google Scholar · View at Scopus
  14. J. Nasiry and I. Popescu, “Dynamic pricing with loss-averse consumers and peak-end anchoring,” Operations Research, vol. 59, no. 6, pp. 1361–1368, 2011. View at Publisher · View at Google Scholar · View at MathSciNet · View at Scopus
  15. J. Lee, “Inventory control by different service levels,” Applied Mathematical Modelling, vol. 35, no. 1, pp. 497–505, 2011. View at Publisher · View at Google Scholar · View at MathSciNet · View at Scopus
  16. J. Lee, “Dynamic pricing inventory control under fixed cost and lost sales,” Applied Mathematical Modelling, vol. 38, no. 2, pp. 712–721, 2014. View at Publisher · View at Google Scholar · View at MathSciNet · View at Scopus
  17. H.-S. Lau, “The newsboy problem under alternative optimization objectives,” The Journal of the Operational Research Society, vol. 31, no. 6, pp. 525–535, 1980. View at Publisher · View at Google Scholar · View at MathSciNet
  18. L. Eeckhoudt, C. Gollier, and H. Schlesinger, “The risk-averse (and prudent) newsboy,” Management Science, vol. 41, no. 5, pp. 786–794, 1995. View at Publisher · View at Google Scholar
  19. M. Bouakiz and M. J. Sobel, “Inventory control with an exponential utility criterion,” Operations Research, vol. 40, no. 3, pp. 603–608, 1992. View at Publisher · View at Google Scholar · View at Zentralblatt MATH · View at MathSciNet
  20. V. Agrawal and S. Seshadri, “Impact of uncertainty and risk aversion on price and order quantity in the newsvendor problem,” Manufacturing and Service Operations Management, vol. 2, no. 4, pp. 410–423, 2000. View at Publisher · View at Google Scholar · View at Scopus
  21. Y. Li, S. Sui, and S. Tong, “Adaptive fuzzy control design for stochastic nonlinear switched systems with arbitrary switchings and unmodeled dynamics,” IEEE Transactions on Cybernetics, vol. 47, no. 2, pp. 403–414, 2017. View at Publisher · View at Google Scholar · View at Scopus
  22. Y. Li, S. Tong, and T. Li, “Observer-based adaptive fuzzy tracking control of MIMO stochastic nonlinear systems with unknown control directions and unknown dead zones,” IEEE Transactions on Fuzzy Systems, vol. 23, no. 4, pp. 1228–1241, 2015. View at Publisher · View at Google Scholar · View at Scopus
  23. D. Simchi-Levi, X. Chen, J. Bramel et al., The Logic of Logistics. Theory, Algorithms, and Applications for Logistics and Supply Chain Management, Springer, 2005.
  24. X. Zhao, P. Shi, X. Zheng, and L. Zhang, “Adaptive tracking control for switched stochastic nonlinear systems with unknown actuator dead-zone,” Automatica, vol. 60, pp. 193–200, 2015. View at Publisher · View at Google Scholar · View at MathSciNet · View at Scopus
  25. R. Thaler, “Mental accounting and consumer choice,” Marketing Science, vol. 4, no. 3, pp. 199–214, 1985. View at Google Scholar
  26. K. T. Talluri and G. J. Van Ryzin, The Theory and Practice of Revenue Management, vol. 68, Springer Science+Business Media LLC, Berlin, Germany, 2006.
  27. S. P. Anderson and A. de Palma, “Multiproduct firms: a nested logit approach,” The Journal of Industrial Economics, vol. 40, no. 3, pp. 261–276, 1992. View at Publisher · View at Google Scholar
  28. J. E. Smith, “Evaluating income streams: a decision analysis approach,” Management Science, vol. 44, no. 12, pp. 1690–1708, 1998. View at Publisher · View at Google Scholar · View at Scopus
  29. Z.-J. M. Shen and X. Su, “Customer behavior modeling in revenue management and auctions: a review and New Research Opportunities,” Production and Operations Management, vol. 16, no. 6, pp. 713–728, 2007. View at Publisher · View at Google Scholar · View at Scopus
  30. S. Kim, W. T. Huh, and S. Dasu, “Pre-announced posted pricing scheme: existence and uniqueness of equilibrium bidding strategy,” Operations Research Letters, vol. 43, no. 2, pp. 151–160, 2015. View at Publisher · View at Google Scholar · View at MathSciNet · View at Scopus