Article ID: | iaor20072709 |
Country: | Netherlands |
Volume: | 6 |
Issue: | 1 |
Start Page Number: | 135 |
End Page Number: | 149 |
Publication Date: | Mar 2007 |
Journal: | Journal of Mathematical Modelling and Algorithms |
Authors: | Haugen Kjetil K., Olstad Asmund, Pettersen Brd I. |
Keywords: | heuristics |
This paper introduces a simple heuristic for a quadratic programming sub-problem within a Lagrangean relaxation heuristic for a dynamic pricing and lot-size problem. This simple heuristic is demonstrated to work well on both ‘standard problem instances’ from the CLSP-literature, as well as on very large-scale cases. Additionally, we introduce price constraints within the framework of dynamic pricing, discuss their relevance in a real world market modelling, and demonstrate their applicability within this algorithmic framework.