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Title: A general model and efficient algorithms for reliable facility location problem under uncertain disruptions
Authors: Li, Y
Li, X
Shu, J
Song, M 
Zhang, K
Issue Date: Jan-2022
Source: INFORMS journal on computing, Jan.-Feb. 2022, v. 34, no. 1, p. 407-426
Abstract: This paper studies the reliable uncapacitated facility location problem in which facilities are subject to uncertain disruptions. A two-stage distributionally robust model is formulated, which optimizes the facility location decisions so as to minimize the fixed facility location cost and the expected transportation cost of serving customers under the worst-case disruption distribution. The model is formulated in a general form, where the uncertain joint distribution of disruptions is partially characterized and is allowed to have any prespecified dependency structure. This model extends several related models in the literature, including the stochastic one with explicitly given disruption distribution and the robust one with moment information on disruptions. An efficient cutting plane algorithm is proposed to solve this model, where the separation problem is solved respectively by a polynomial-time algorithm in the stochastic case and by a column generation approach in the robust case. Extensive numerical study shows that the proposed cutting plane algorithm not only outperforms the best-known algorithm in the literature for the stochastic problem under independent disruptions but also efficiently solves the robust problem under correlated disruptions. The practical performance of the robust models is verified in a simulation based on historical typhoon data in China. The numerical results further indicate that the robust model with even a small amount of information on disruption correlation can mitigate the conservativeness and improve the location decision significantly.
Keywords: Uncapacitated facility location
Uncertain facility disruptions
Stochastic and distributionally robust optimizations
Cutting plane
Column generation
Publisher: Informs
Journal: INFORMS journal on computing 
ISSN: 1091-9856
EISSN: 1526-5528
DOI: 10.1287/ijoc.2021.1063
Rights: © 2021 INFORMS
This is the accepted manuscript of the following article: Yongzhen Li, Xueping Li, Jia Shu, Miao Song, Kaike Zhang (2021) A General Model and Efficient Algorithms for Reliable Facility Location Problem Under Uncertain Disruptions. INFORMS Journal on Computing 34(1):407-426, which has been published in final form at
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