A two-stage linear production planning model with partial cooperation under stochastic demands

Ichiro Nishizaki (), Tomohiro Hayashida (), Shinya Sekizaki () and Kojiro Furumi
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Ichiro Nishizaki: Hiroshima University
Tomohiro Hayashida: Hiroshima University
Shinya Sekizaki: Hiroshima University
Kojiro Furumi: Hiroshima University

Annals of Operations Research, 2023, vol. 320, issue 1, No 11, 293-324

Abstract: Abstract We consider two-stage stochastic linear production planning problems with partial cooperation including resource pooling, technology transfer and product transshipment, and employ a two-stage programming model with simple recourse to address uncertain demands. At the first stage, each manufacturer individually determines the production level according to its own technology and transferred technologies. After the demands are realized, multiple manufacturers jointly produce the products using pooled resources, and surplus products are transshipped to manufacturers with residual demands. Using the core solution concept from cooperative game theory, the additional profit obtained at the second stage is divided among all manufacturers. We develop a method to find a Nash equilibrium point such that the sum of the profits earned by all manufacturers is maximized. To demonstrate the validity of the proposed model, numerical examples are presented.

Keywords: Two-stage linear production planning; Two-stage programming with simple recourse; Cooperative game; Nash equilibrium point (search for similar items in EconPapers)
Date: 2023
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DOI: 10.1007/s10479-022-05056-w

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