Inverse Optimization: An Application to the Capacitated Plant Location Problem

Bitran, Gabriel R. ; Chandru, Vijaya ; Sempolinski, Dorothy E. ; Shapiro, Jeremy F. (1981) Inverse Optimization: An Application to the Capacitated Plant Location Problem Management Science, 27 (10). pp. 1120-1141. ISSN 0025-1909

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Official URL: http://doi.org/10.1287/mnsc.27.10.1120

Related URL: http://dx.doi.org/10.1287/mnsc.27.10.1120

Abstract

Lagrangean techniques have had wide application to the optimization of discrete optimization problems. Inverse optimization refers to the fact that each time a Lagrangean calculation is made for a specific problem with a given resources vector, an optimal solution is obtained for a related problem with a suitably adjusted resources vector. This property is studied in depth for the capacitated plant location problem and new parametric methods for that problem are suggested. Computational experience is reported.

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