Incorporating Pricing Decisions into the Stochastic Dynamic Fleet Management Problem

Huseyin Topaloglu () and Warren Powell ()
Additional contact information
Huseyin Topaloglu: School of Operations Research and Industrial Engineering, Cornell University, Ithaca, New York 14853
Warren Powell: Department of Operations Research and Financial Engineering, Princeton University, Princeton, New Jersey 08544

Transportation Science, 2007, vol. 41, issue 3, 281-301

Abstract: This paper shows how to coordinate the decisions on pricing and fleet management of a freight carrier. We consider a setting where the carrier announces its prices at the beginning of a certain time horizon and the load arrivals over this horizon depend on the announced prices. Assuming that the vehicle fleet is managed according to a particular class of fleet management models, we present a tractable method to obtain sample path-based directional derivatives of the objective function with respect to the prices. We use this information to search for a good set of prices. Numerical experiments show that our approach yields high-quality solutions.

Keywords: dynamic fleet management; pricing; dynamic programming (search for similar items in EconPapers)
Date: 2007
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (11)

Downloads: (external link)
http://dx.doi.org/10.1287/trsc.1070.0196 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:inm:ortrsc:v:41:y:2007:i:3:p:281-301

Access Statistics for this article

More articles in Transportation Science from INFORMS Contact information at EDIRC.
Bibliographic data for series maintained by Chris Asher ().