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Attracting international migrant labor: Investment optimization to alleviate supply chain labor shortages

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  • Nagurney, Anna

Abstract

The COVID-19 pandemic has disrupted supply chains globally with a major shortfall being that of labor shortages from production through distribution activities. In this paper, we construct a new supply chain network optimization model that includes both domestic labor and international migrant labor from multiple countries, with the latter made possible through investments in attracting labor subject to a budget constraint. We allow for different wage settings for domestic versus migrant labor and also have the flexibility of providing true information as to the wages of migrants or not. We derive variational inequality formulations of the model, along with qualitative properties, and present an algorithm that yields closed form expressions for the underlying problem variables at each iteration. The model is one of the very few variational inequality operations research models with nonlinear constraints. Three series of algorithmically solved numerical examples, motivated by a high value agricultural product — that of truffles, demonstrate the insights in terms of profits, prices, product path flows, and investments, with variations in the data including that of truthful and untruthful wages being used to attract migrant labor.

Suggested Citation

  • Nagurney, Anna, 2022. "Attracting international migrant labor: Investment optimization to alleviate supply chain labor shortages," Operations Research Perspectives, Elsevier, vol. 9(C).
    • Handle: RePEc:eee:oprepe:v:9:y:2022:i:c:s2214716022000100
    DOI: 10.1016/j.orp.2022.100233
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    1. Kalashnikov, Vyacheslav & Kalashnykova, Nataliya & Rojas, Ramón Luévanos & Muí±os, Mario Méndez & Uranga, César & Rojas, Arnulfo Luévanos, 2008. "Numerical experimentation with a human migration model," European Journal of Operational Research, Elsevier, vol. 189(1), pages 208-229, August.
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    6. Nagurney, Anna, 2021. "Supply chain game theory network modeling under labor constraints: Applications to the Covid-19 pandemic," European Journal of Operational Research, Elsevier, vol. 293(3), pages 880-891.
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    10. Anna Nagurney, 2021. "Perishable Food Supply Chain Networks with Labor in the Covid-19 Pandemic," Springer Optimization and Its Applications, in: Ilias S. Kotsireas & Anna Nagurney & Panos M. Pardalos & Arsenios Tsokas (ed.), Dynamics of Disasters, pages 173-193, Springer.
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    14. Anna Nagurney, 2021. "A Multiperiod Supply Chain Network Optimization Model with Investments in Labor Productivity Enhancements in an Era of COVID-19 and Climate Change," SN Operations Research Forum, Springer, vol. 2(4), pages 1-22, December.
    15. Chowdhury, Priyabrata & Paul, Sanjoy Kumar & Kaisar, Shahriar & Moktadir, Md. Abdul, 2021. "COVID-19 pandemic related supply chain studies: A systematic review," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 148(C).
    16. Nagurney, Anna & Pan, Jie & Zhao, Lan, 1992. "Human migration networks," European Journal of Operational Research, Elsevier, vol. 59(2), pages 262-274, June.
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    18. Anna Nagurney & Patrizia Daniele & Giorgia Cappello, 2021. "Capacitated Human Migration Networks and Subsidization," Springer Optimization and Its Applications, in: Ilias S. Kotsireas & Anna Nagurney & Panos M. Pardalos & Arsenios Tsokas (ed.), Dynamics of Disasters, pages 195-217, Springer.
    19. Nagurney, Anna & Salarpour, Mojtaba & Daniele, Patrizia, 2019. "An integrated financial and logistical game theory model for humanitarian organizations with purchasing costs, multiple freight service providers, and budget, capacity, and demand constraints," International Journal of Production Economics, Elsevier, vol. 212(C), pages 212-226.
    20. Anna Nagurney & Patrizia Daniele & Ladimer S. Nagurney, 2020. "Refugee migration networks and regulations: a multiclass, multipath variational inequality framework," Journal of Global Optimization, Springer, vol. 78(3), pages 627-649, November.
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