Article ID: | iaor20042690 |
Country: | India |
Volume: | 24 |
Issue: | 3 |
Start Page Number: | 445 |
End Page Number: | 465 |
Publication Date: | Sep 2003 |
Journal: | Journal of Information & Optimization Sciences |
Authors: | Zenios Stavros A., Musmanno Roberto, Beraldi Patrizia, Triki Chefi |
Keywords: | programming: linear |
In several real-world applications, modelled by two-stage stochastic problems, first- and second-stage decisions (or some of their components) represent identical variables of the problem that is modelled. In these cases an appropriate solution of the problem might require that the second-stage decisions do not differ substantially from the corresponding first-stage ones. In this paper we propose a parametric approach to control the variability of the first- and second-stage decisions and present a suitable solution framework. The advantage of the new approach is illustrated by considering two specific applications in electric power management and financial planning.