A Markov Decision Model and Decomposition Heuristic for Dynamic Vehicle Dispatching

Alan S. Minkoff
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Alan S. Minkoff: IBM Corporation, New York, New York

Operations Research, 1993, vol. 41, issue 1, 77-90

Abstract: We describe a dynamic and stochastic vehicle dispatching problem called the delivery dispatching problem. This problem is modeled as a Markov decision process. Because exact solution of this model is impractical, we adopt a heuristic approach for handling the problem. The heuristic is based in part on a decomposition of the problem by customer, where customer subproblems generate penalty functions that are applied in a master dispatching problem. We describe how to compute bounds on the algorithm's performance, and apply it to several examples with good results.

Keywords: dynamic programming; Markov; finite state: Markov decision model for vehicle dispatching; transportation; route selection: route selection for inventory replenishment (search for similar items in EconPapers)
Date: 1993
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