Learning Effects in Economic Lot Sizing

The classical square-root formula for optimal lot size is a useful tool especially for those manufacturing processes in which labor intensive items are produced in small quantities. There is a class of stationary lot sizing problems to which this formula applies. With learning effects introduced into the production cost of this class of problems the optimal lot size becomes the solution of a transcendental equation. Numerical solutions are presented as well as an approximation which has the structure of the classical formula.