Service Network Design: With Arnt-Gunnar Lium and Teodor Gabriel Crainic

This chapter represents an investigation following the lines of this book, where the focus is that of a graduate student studying the effects of uncertainty on a specific problem. There is no customer in this problem, and it has not reached the level of sophistication needed for a real application. However, it goes to the heart of this book: What does stochastics do to my problem? What are the implicit options? This chapter is based on the Ph.D. thesis of Arnt-Gunnar Lium of Molde University College. For an overview see [40]. You are going to meet an inherently two-stage problem with, principally, infinitely many stages. However, since in this situation we do not really need the decisions of the inherent second stage, we can approximate, ending up with a two-stage model. In our view, this points to the heart of stochastic programming: inherently two-stage problems with rather complicated stages after the first one.

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