A versatile framework for cooperative hub network development

Frans Cruijssen*, Peter Borm, Wout Dullaert, Herbert Hamers

*Corresponding author for this work

Research output: Contribution to JournalArticleAcademicpeer-review

Abstract

This paper introduces a framework for cooperative hub network development. Building a joint physical hub for the transshipment of goods is expensive and, therefore, involves considerable risks for cooperating companies. In a practical setting, it is unlikely that an entire network will be built at once. Rather, the partners will have a more cautious attitude and build hub facilities one by one. In the proposed framework, each time a new hub is introduced, the partners will have the opportunity to decide whether or not they will participate (and thus, invest) in this network extension. In addition, joint cost savings will be allocated to the partners using the Shapley value, a well-known solution concept from cooperative game theory. This framework can accommodate any type of optimisation procedure for network design.

Original languageEnglish
Pages (from-to)210-227
Number of pages18
JournalEuropean Journal of Industrial Engineering
Volume4
Issue number2
DOIs
Publication statusPublished - Jan 2010

Keywords

  • Cooperative game theory
  • Horizontal cooperation
  • Hub networks

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