Approximation Algorithms for the Bid Construction Problem in Combinatorial Auctions for the Procurement of Freight Transportation Contracts
Science Direct Working Paper No S1574-034X(04)70265-3
27 Pages Posted: 5 Jun 2017 Last revised: 18 Nov 2018
Date Written: March 2003
Abstract
The bid valuation and construction problem for carriers facing combinatorial auctions for the procurement of freight transportation contracts is very difficult and involves the computation of a number of NP-hard sub problems. In this paper we examine computationally tractable approxim ation methods for estim ating these values and constructing bids. The benefit of our approxim ation method is that it provides a way for carriers to construct optimal or near optimal bids by solving a single NP-hard problem. This represents a significant improvement in efficiency. In addition, this method can be extended to m any other applications.
Keywords: Combinatorial auctions, contract procurement, set covering, trucking operations
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