Optimal and Approximate Policies for Inventory Systems With Order Crossover

A common assumption in inventory analysis is that replenishment orders arrive in the same sequence in which they were placed. In practice, however, a variety of factors may cause orders to arrive out of sequence, a phenomenon known as order crossover. This article analyzes a periodic‐review inventory system for a single item with discrete variable demand and discrete variable and long lead‐times (relative to the review period). Under such a scenario, multiple orders are simultaneously outstanding, and orders may arrive in a different sequence than placed. If such order crossover occurs, traditional inventory analysis overstates expected shortages and standard inventory control policies are no longer optimal. This article discusses why orders may cross over in practice and investigates the implications of order crossover to inventory management policies. We investigate the cost performance of optimal policies under order crossover and also suggest approximate policies which are easier to compute and implement. Both the optimal and approximate policies take advantage of detailed real‐time information about the status of pending orders and goods in transit, and hence in a majority of cases perform better than commonly used policies which do not incorporate such information.     

Are Central Bank Preferences Asymmetric? A Comment

A recent paper by Ruge-Murcia (2004) on asymmetric central bank objectives provides a new perspective on the policy roots of inflation in developed economies. More precisely, the paper demonstrates that if the distribution of the supply shocks is normal, then the reduced-form solution for inflation implies a positive (or negative) relation between average inflation and the variance of shocks. We argue that the evidence offered in support of this hypothesis suffers from lack of identification because Phillips curve nonlinearity combined with quadratic central bank preferences yield the same reduced-form solution for inflation. If so, estimating reduced form for inflation will not be able to discriminate between these models. Yet they have quite different implications for policy. Other, structural, evidence is needed.     

The Dispute Settlement Mechanism of the WTO: A Brief History and an Evaluation from Economic,Contractarian and Legal Perspectives

Any rule‐based system has to include a mechanism for the enforcement of its rules and a means for settlement of disputes about alleged violation of rules. The General Agreement on Tariffs and Trade (GATT), concluded in 1947, and its successor the World Trade Organisation (WTO) that subsumed it in 1995, embody rules governing the global trading system as specified in various agreements that their members have entered into over time. Naturally, both had a dispute settlement mechanism (DSM). It was a primarily political one in the GATT and was transformed into a largely legalistic one in the multilateral agreement that established the WTO. This paper reviews the history and evaluation of the two DSMs and examines their efficiency based on appropriate criteria. It views them from three alternative and overlapping perspectives: political‐diplomatic, legal‐economic and social. It concludes with a discussion of the unresolved problems in the operation of the WTO's DSM and the prospects of resolving them in the ongoing Doha Round of multilateral trade negotiations.     

Construct validity of some unweighted product-count diversification measures

Construct validities are assessed for three simple-to-compute, unweighted, SIC-based continuous diversification measures and a recently proposed two-dimensional, SIC-based categorical diversification measure. Two of the three continuous measures are found to correspond strongly to Rumelt's categorical measures, suggesting that these two objective and easy-to-calculate measures are better suited for large sample, strategy research than has previously been assumed. No support is found for the two-dimensional measure.     

Operating decisions, supplier availability and quality: An empirical study

In the just-in-time (JIT) philosophy, purchasing strategies advocate the use of fewer sources of supply to enable a firm to improve the quality of its products. However, there is paucity of empirical evidence in support of the theory. We develop a model by integrating concepts from manufacturing, marketing, and business strategy to better understand the links between operating decisions of the firm, supplier availability, and product quality. We empirically test the hypotheses using cross-sectional PIMS data. Our analysis shows that operating decisions and environmental factors such as wider product lines, lower levels of competition, and greater frequency of product changes increase the likelihood of a firms' reduction of supplier base, which in turn raises quality levels.     

Concentration in ownership of plant variety rights: some implications for developing countries

This paper explores concentration levels in the ownership of intellectual property rights over plant varieties worldwide. An analysis of data for 30 UPOV member-countries shows a high degree of concentration in the ownership of plant variety rights for six major crops at the national level in the developed world. Much of this concentration has arisen owing to the rapid consolidation of the seed industry through mergers and acquisitions, especially in the 1990s. A high degree of concentration in the ownership of plant variety rights, in combination with recent efforts to strengthen plant variety protection regimes, is likely to have significant effects on the prospects for future innovation in plant breeding and the distribution of market power between companies. For developing countries, concentration in intellectual property right ownership may have important implications for the structure of domestic seed industries and access to protected varieties and associated plant breeding technologies. These implications for developing countries are likely to become apparent in the context of the rapid spread of plant variety protection and access legislation, emerging changes in the international exchange regime for plant material and liberalised investment policies permitting foreign investment in the seeds sector.