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Sensitivity Analysis of a Dynamic Fleet Management Model Using Approximate Dynamic Programming

Author

Listed:
  • Huseyin Topaloglu

    (School of Operations Research and Industrial Engineering, Cornell University, Ithaca, New York 14853)

  • Warren B. Powell

    (Department of Operations Research and Financial Engineering, Princeton University, Princeton, New Jersey 08544)

Abstract

We present tractable algorithms to assess the sensitivity of a stochastic dynamic fleet management model to fleet size and load availability. In particular, we show how to compute the change in the objective function value in response to an additional vehicle or an additional load introduced into the system. The novel aspect of our approach is that it does not require multiple simulations with different values of the model parameters, and in this respect it differs from trial-and-error-based “what-if” analyses. Numerical experiments show that the proposed methods are accurate and computationally attractive.

Suggested Citation

  • Huseyin Topaloglu & Warren B. Powell, 2007. "Sensitivity Analysis of a Dynamic Fleet Management Model Using Approximate Dynamic Programming," Operations Research, INFORMS, vol. 55(2), pages 319-331, April.
    • Handle: RePEc:inm:oropre:v:55:y:2007:i:2:p:319-331
    DOI: 10.1287/opre.1060.0347
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    References listed on IDEAS

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    6. Huseyin Topaloglu & Warren B. Powell, 2006. "Dynamic-Programming Approximations for Stochastic Time-Staged Integer Multicommodity-Flow Problems," INFORMS Journal on Computing, INFORMS, vol. 18(1), pages 31-42, February.
    7. Tassio A. Carvalho & Warren B. Powell, 2000. "A Multiplier Adjustment Method for Dynamic Resource Allocation Problems," Transportation Science, INFORMS, vol. 34(2), pages 150-164, May.
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    Cited by:

    1. Guodong Yu & Yu Yang, 2019. "Dynamic routing with real-time traffic information," Operational Research, Springer, vol. 19(4), pages 1033-1058, December.
    2. Novoa, Clara & Storer, Robert, 2009. "An approximate dynamic programming approach for the vehicle routing problem with stochastic demands," European Journal of Operational Research, Elsevier, vol. 196(2), pages 509-515, July.
    3. Huseyin Topaloglu & Warren Powell, 2007. "Incorporating Pricing Decisions into the Stochastic Dynamic Fleet Management Problem," Transportation Science, INFORMS, vol. 41(3), pages 281-301, August.
    4. Archis Ghate & Robert L. Smith, 2013. "A Linear Programming Approach to Nonstationary Infinite-Horizon Markov Decision Processes," Operations Research, INFORMS, vol. 61(2), pages 413-425, April.
    5. Kuyzu, Gültekin & Akyol, Çağla Gül & Ergun, Özlem & Savelsbergh, Martin, 2015. "Bid price optimization for truckload carriers in simultaneous transportation procurement auctions," Transportation Research Part B: Methodological, Elsevier, vol. 73(C), pages 34-58.
    6. SteadieSeifi, M. & Dellaert, N.P. & Nuijten, W. & Van Woensel, T. & Raoufi, R., 2014. "Multimodal freight transportation planning: A literature review," European Journal of Operational Research, Elsevier, vol. 233(1), pages 1-15.

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