Optimal allocation of limited and random network resources to discrete stochastic demands for standardized cargo transportation networks

Xinchang Wang

Transportation Research Part B: Methodological, 2016, vol. 91, issue C, 310-331

Abstract: We consider the resource allocation problem with discrete random demands and discrete random resource capacities for standardized cargo transportation networks, in which a freight operator needs to determine the integral quantity of booking requests to be accepted for each product to maximize the expected profit. We formulate the problem as a stochastic integer programming model and provide theoretical results that completely characterize the optimal solution to the stochastic model under a special case. We present a progressive augmentation algorithm and a sampling based method for solving the stochastic model under a general case. We also offer numerical experiments to test the two methods and shed light on their performances.

Keywords: Standardized cargo transportation; Resource allocation; Random capacity; Revenue management; Network effects; Discrete random demand (search for similar items in EconPapers)
Date: 2016
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Citations: View citations in EconPapers (3)

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DOI: 10.1016/j.trb.2016.06.002

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