A cooperative game theory approach for location-routing-inventory decisions in humanitarian relief chain incorporating stochastic planning

Abstract

This paper describes a new simulation based mathematical model for locating distribution centres, vehicle routing, and inventory problems under earthquake conditions. In this paper, the proposed network includes affected areas, suppliers, distribution centres, and hospitals. Additionally, the basic infrastructures of the city, which are very fragile at the time of the earthquake, are identified. Then, the demand of each relief commodity is calculated depending on the different earthquake scenarios using simulation. The estimated demand is incorporated into the mathematical model as an uncertain parameter. The proposed methodology is designed as a two-stage model so that in the first stage the location and inventory of distribution centres are addressed. Thereafter, in the second stage the routing decisions are taken for the distribution of relief commodities from the distribution centres and suppliers to the affected areas. Due to the NP-hardness of the second stage model, this model is solved using multi-objective stochastic fractal search. This algorithm is one of the population-based and stochastic optimization techniques and inspired by the natural phenomenon of fractal growth. It should be noted that in the second stage, a cooperative game theory of coalition type is considered, which resulted in synergies that minimize the relief golden time. The kind of cooperation is the use of potential of co-operators’ vehicle. In this stage, the possibility for the players to cooperate by sharing people and commodities transportation requests is considered. Also, to validate the model, a real case study is provided for a possible earthquake in Tehran. Finally, the comparison between the simulation results and the values obtained from the real system evaluates the performance of the implemented model. Considering normality and a 95% confidence interval, it can be concluded that the proposed model provides a precise representation of the real system's performance.