A network option portfolio management framework for adaptive transportation planning

Joseph Ying Jun Chow, Amelia C. Regan, Fatemeh Ranaiefar, Dmitri I. Arkhipov

Research output: Contribution to journalArticle

Abstract

A real option portfolio management framework is proposed to make use of an adaptive network design problem developed using stochastic dynamic programming methodologies. The framework is extended from Smit's and Trigeorgis' option portfolio framework to incorporate network synergies. The adaptive planning framework is defined and tested on a case study with time series origin-destination demand data. Historically, OD time series data is costly to obtain, and there has not been much need for it because most transportation models use a single time-invariant estimate based on deterministic forecasting of demand. Despite the high cost and institutional barriers of obtaining abundant OD time series data, we illustrate how having higher fidelity data along with an adaptive planning framework can result in a number of improved management strategies. An insertion heuristic is adopted to run the lower bound adaptive network design problem for a coarse Iran network with 834 nodes, 1121 links, and 10. years of time series data for 71,795 OD pairs.

Original languageEnglish (US)
Pages (from-to)765-778
Number of pages14
JournalTransportation Research Part A: Policy and Practice
Volume45
Issue number8
DOIs
StatePublished - Oct 2011

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portfolio management
Time series
time series
Planning
planning
Dynamic programming
demand
synergy
Iran
heuristics
programming
Portfolio management
Transportation planning
methodology
Costs
costs
management
Time series data

Keywords

  • Adaptive network design
  • Intercity truck flow
  • Portfolio management
  • Real options
  • Transportation planning

ASJC Scopus subject areas

  • Management Science and Operations Research
  • Civil and Structural Engineering
  • Transportation

Cite this

A network option portfolio management framework for adaptive transportation planning. / Chow, Joseph Ying Jun; Regan, Amelia C.; Ranaiefar, Fatemeh; Arkhipov, Dmitri I.

In: Transportation Research Part A: Policy and Practice, Vol. 45, No. 8, 10.2011, p. 765-778.

Research output: Contribution to journalArticle

Chow, Joseph Ying Jun ; Regan, Amelia C. ; Ranaiefar, Fatemeh ; Arkhipov, Dmitri I. / A network option portfolio management framework for adaptive transportation planning. In: Transportation Research Part A: Policy and Practice. 2011 ; Vol. 45, No. 8. pp. 765-778.
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