Cost allocation in collaborative forest transportation
AbstractTransportation planning is an important part of the wood flow chain in forestry. There are often several forest companies operating in the same region and co-ordination between two or more companies is rare. However, there is an increasing interest in collaborative planning as the potential savings are large, often in the range 5-15%. A key question is how savings should be distributed among the participants. In this paper we investigate a number of possibilities based on economic models including Shapley value, the nucleolus, separable and non-separable costs, shadow prices and volume weights. We also propose a new allocation method based on finding as equal relative profits as possible among the participants. A case study including eight forest companies is described and analyzed.
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Bibliographic InfoPaper provided by Department of Business and Management Science, Norwegian School of Economics in its series Discussion Papers with number 2006/15.
Length: 27 pages
Date of creation: 03 Nov 2006
Date of revision:
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Web page: http://www.nhh.no/en/research-faculty/department-of-business-and-management-science.aspx
More information through EDIRC
Transportation; OR in natural resources; Supply chain management; Economics; Group decisions and negotiations; Linear programming;
Find related papers by JEL classification:
- L91 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Transportation: General
- Q21 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Demand and Supply; Prices
- Q23 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Forestry
This paper has been announced in the following NEP Reports:
- NEP-ALL-2006-11-25 (All new papers)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Tijs, S.H. & Driessen, T.S.H., 1986. "Game theory and cost allocation problems," Open Access publications from Tilburg University urn:nbn:nl:ui:12-154261, Tilburg University.
- S. H. Tijs & T. S. H. Driessen, 1986. "Game Theory and Cost Allocation Problems," Management Science, INFORMS, vol. 32(8), pages 1015-1028, August.
- Audy, Jean-François & D’Amours, Sophie & Rönnqvist, Mikael, 2012. "An empirical study on coalition formation and cost/savings allocation," International Journal of Production Economics, Elsevier, vol. 136(1), pages 13-27.
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