| Article ID: | iaor2007555 |
| Country: | Netherlands |
| Volume: | 34 |
| Issue: | 5 |
| Start Page Number: | 517 |
| End Page Number: | 524 |
| Publication Date: | Sep 2006 |
| Journal: | Operations Research Letters |
| Authors: | Zhang Ju-Liang, Chen Jian |
| Keywords: | stochastic processes |
This paper addresses the simultaneous determination of pricing and inventory control with learning. The Bayesian formulation of this model results in a dynamic program with a multi-dimension state-space. We show that the state-space of the Bayesian model can be reduced under some conditions and characterize the structure of the optimal policy.