Knowledge that Transforms

WE ipropose to outline a method for deriving optimal rules of inventory policy for finished goods. The problem of inventories exists not only for business enterprises but also for nonprofit agencies such as governmental establishments and their various branches. Moreover, the concept of inventories can be generalized so as to include not only goods but also disposable reserves of manpower as well as various stand-by devices. Also, while inventories of finished goods present the simplest problem, the concept can be extended to goods which can be transformed, at a cost, into one or more kinds of finished goods if and when

A model was constructed that incorporates rational grounds for the choice by two individuals between an employment contract and a contract of the ordinary kind (which we have called a sales contract). By a generalization of this model one can account for the fact that in an employment contract certain aspects of the workers's behavior are stipulated in the contract terms, certain other aspects are placed within the authority of the employer, and still other aspects are left to the worker's choice. Since administrative theory was interested in explaining behavior within the framework of employment relations, and economic theory in explaining behavior within the area of market relations, the model suggests one possible way of relating these two bodies of theory. The most serious limitations of the model lie in the assumptions of rational utility-maximizing behavior incorporated in it. (Author)

Abstract : A numerical evaluation of the 'dead loss' associated with a nonoptimal situation (in the Pareto sense) of an economic system is sought. Use is made of the intrinsic price systems associated with optimal situations of whose existence a noncalculus proof is given. A coefficient of resource-utilization yielding measures of the efficiency of the economy is introduced. The treatment is based on vector set properties in the commodity space. (Author)