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Home market effect versus multinationals

Eric Toulemonde

No 2007046, LIDAM Discussion Papers CORE from Université catholique de Louvain, Center for Operations Research and Econometrics (CORE)

Abstract: In this paper, based on the cyclic scheduling formulation of Schilling and Pantelides [22], we propose a continuous time mixed integer linear programming (MILP) formulation for the cyclic scheduling of a mixed plant, i.e. a plant composed of batch and continuous tasks. The cycle duration is a variable of the model and the objective is to maximize productivity. By using strengthening techniques and the analysis of small polytopes related to the problem formulation, we strengthen the initial formulation by tightening some initial constraints and by adding valid inequalities. We show that this strengthened formulation is able to solve moderate size problems quicker than the initial one. However, for real size cases, it remains difficult to obtain the optimal solution of the scheduling problem quickly. Therefore, we introduce MILP-based heuristic methods in order to solve these larger instances, and show that they can provide quite good feasible solutions quickly.

Keywords: globalization; economic geography; trade costs; multinational firms; home market effect (search for similar items in EconPapers)
JEL-codes: F12 F15 F23 R12 R30 (search for similar items in EconPapers)
Date: 2007-07-01
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Citations: View citations in EconPapers (1)

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