Location choice and risk attitude of a decision maker

被引:29
作者
Berman, Oded [1 ]
Sanajian, Nima [1 ]
Wang, Jiamin [2 ]
机构
[1] Univ Toronto, Joseph L Rotman Sch Management, 105 St George St, Toronto, ON M5S 3E6, Canada
[2] Long Isl Univ, Coll Management, Post Campus,720 Northern Blvd, Greenvale, NY 11548 USA
来源
OMEGA-INTERNATIONAL JOURNAL OF MANAGEMENT SCIENCE | 2017年 / 66卷
基金
加拿大自然科学与工程研究理事会;
关键词
Facility location; Mixed-integer quadratic programming; Quadratic assignment problem; Mean-variance; Risk-averse; Risk-seeking; ALGORITHMIC APPROACH; OPTIMUM LOCATIONS; NETWORK; MINIMAX; MODEL; MANAGEMENT; FACILITIES; VARIANCE; UNIFORM;
D O I
10.1016/j.omega.2016.03.002
中图分类号
C93 [管理学];
学科分类号
12 ; 1201 ; 1202 ; 120202 ;
摘要
In this paper we study the effect of a decision maker's risk attitude on the median and center problems, two well-known location problems, with uncertain demand in the mean-variance framework. We provide a mathematical programming formulation for both problems in the form of quadratic programming and develop solution procedures. In particular, we consider the vertex and absolute median problems separately, and identify a dominant set for the center problem. Glover's linearization method is applied to solve the vertex median problem. We also develop a branch and bound algorithm and a heuristic as the linearization technique takes too long for the vertex median problem on large networks. A computational experiment is conducted to compare the performance of the algorithms. We demonstrate the importance of taking into account the volatility and correlation structure when a location decision is made. The closest assignment property is also discussed for these location problems under the mean-variance objective. (C) 2016 Elsevier Ltd. All rights reserved.
引用
收藏
页码:170 / 181
页数:12
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