A competitive hub location and pricing problem

Armin Lüer-Villagra, Vladimir Marianov

Resultado de la investigación: Contribución a una revistaArtículo

56 Citas (Scopus)

Resumen

We formulate and solve a new hub location and pricing problem, describing a situation in which an existing transportation company operates a hub and spoke network, and a new company wants to enter into the same market, using an incomplete hub and spoke network. The entrant maximizes its profit by choosing the best hub locations and network topology and applying optimal pricing, considering that the existing company applies mill pricing. Customers' behavior is modeled using a logit discrete choice model. We solve instances derived from the CAB dataset using a genetic algorithm and a closed expression for the optimal pricing. Our model confirms that, in competitive settings, seeking the largest market share is dominated by profit maximization. We also describe some conditions under which it is not convenient for the entrant to enter the market.

Idioma originalInglés
Páginas (desde-hasta)734-744
Número de páginas11
PublicaciónEuropean Journal of Operational Research
Volumen231
N.º3
DOI
EstadoPublicada - 16 dic 2013

Áreas temáticas de ASJC Scopus

  • Modelización y simulación
  • Ciencia de la gestión e investigación de operaciones
  • Gestión y sistemas de información

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