Independent thesis Advanced level (degree of Master (Two Years)), 20 credits / 30 HE credits
The location-allocation problem has been studied over 50 years and recently a
new method called “gravity p-median model” is introduced to the public. The key
idea is that the probability of customers visit a facility is based on a distance decay
function rather than directly choose the nearest one. An empirical test shows that the
solution of gravity p-median model with exponential distance decay function is
unstable and of limit use.
This paper extends the research to apply gravity p-median model with three
different distance decay functions in Dalecarlia, Sweden. The distance decay
functions are estimated from a Swedish survey by maximum likelihood estimation.
The models are optimized by simulated annealing. The result suggests that different
distance decay functions dominate the solutions of gravity p-median model, and the
log-normal decay function can provide stable solutions.
2014.