Publication Type

Conference Proceeding Article

Version

publishedVersion

Publication Date

2-2016

Abstract

With the advent of e-commerce, logistics providers are faced with the challenge of handling fluctuating and sparsely distributed demand, which raises their operational costs significantly. As a result, horizontal cooperation are gaining momentum around the world. One of the major impediments, however, is the lack of stable and fair profit sharing mechanism. In this paper, we address this problem using the framework of computational cooperative games. We first present cooperative vehicle routing game as a model for collaborative logistics operations. Using the axioms of Shapley value as the conditions for fairness, we show that a stable, fair and budget balanced allocation does not exist in many instances of the game. By relaxing budget balance, we then propose an allocation scheme based on the normalized Shapley value. We show that this scheme maintains stability and fairness while requiring minimum subsidy. Finally, using numerical experiments we demonstrate the feasibility of the scheme under various settings.

Discipline

Artificial Intelligence and Robotics | Operations and Supply Chain Management

Publication

Proceedings fo the Thirtieth AAAI Conference on Artificial Intelligence (AAAI-16): February 12-17, 2016, Phoenix, Arizona

First Page

3785

Last Page

3792

Publisher

AAAI Press

City or Country

Palo Alto, CA

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