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Coordinating decentralized linear programs by exchange of primal information

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  • Albrecht, Martin
  • Stadtler, Hartmut

Abstract

We present a scheme for coordinating decentralized parties that share central resources but hold private information about their decision problems modeled as linear programs. This setting is of particular importance for supply chains, in which the plans of independent, often legally separated, parties have to be synchronized. The scheme is based on an iterative generation and exchange of proposals regarding the parties’ input to or withdrawal from the central resources (i.e. primal information). We prove that the system-wide optimum can be identified in a finite number of steps. A simple numerical example illustrates the information exchange and the models involved when coordinating a two-stage supply chain.

Suggested Citation

  • Albrecht, Martin & Stadtler, Hartmut, 2015. "Coordinating decentralized linear programs by exchange of primal information," European Journal of Operational Research, Elsevier, vol. 247(3), pages 788-796.
    • Handle: RePEc:eee:ejores:v:247:y:2015:i:3:p:788-796
    DOI: 10.1016/j.ejor.2015.06.045
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    2. G. Rius-Sorolla & J. Maheut & S. Estellés-Miguel & J. P. Garcia-Sabater, 2020. "Coordination mechanisms with mathematical programming models for decentralized decision-making: a literature review," Central European Journal of Operations Research, Springer;Slovak Society for Operations Research;Hungarian Operational Research Society;Czech Society for Operations Research;Österr. Gesellschaft für Operations Research (ÖGOR);Slovenian Society Informatika - Section for Operational Research;Croatian Operational Research Society, vol. 28(1), pages 61-104, March.
    3. Karaca, Utku & Birbil, Ş. İlker & Aydın, Nurşen & Mullaoğlu, Gizem, 2023. "Masking primal and dual models for data privacy in network revenue management," European Journal of Operational Research, Elsevier, vol. 308(2), pages 818-831.

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