TRANSPORTATION PROBLEMS WITH AGGREGATED DESTINATIONS WHEN DEMANDS ARE UNCERTAIN.

THE PAPER CONSIDERS THE EFFECTS OF USING A SMALL, AGGREGATEAPPLIED MODEL IN PLACE OF A LARGER, MORE DETAILED ONE. FORMULATION OF THE AGGREGATE OBJECTIVE FUNCTION TURNS OUT TO DEPEND ON HOW ONE CHOOSES TO USE ( ″ DISAGGREGATE ″ ) THE SOLUTION; SEVERAL ALTERNATIVE METHODS ARE EXAMINED. BOUNDS ARE DERIVED ON THE ERROR INDUCED BY THE APPROXIMATION, THUS FACILITATING COMPARISON OF ALTERNATIVE AGGREGATIONS. ALSO CONSIDERED IS THE PROBLEM OF ESTIMATING DEMANDS FOR AN AGGREGATE-LEVEL DETERMINISTIC PROBLEM. IN A SPECIFIC SENSE, IT IS OFTEN NOT THE CASE THAT SUCH AGGREGATE DEMANDS ARE EASIER TO ESTIMATE THAN THE DETAILED DEMANDS. THIS IS BECAUSE AGGREGATION AND CENTRALIZATION ARE NOT THE SAME THING.

Duke Scholars

Author Paul H. Zipkin Fuqua School of Business