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Testing the gravity p-median model empirically
Dalarna University, School of Technology and Business Studies, Statistics.ORCID iD: 0000-0003-2317-9157
Dalarna University, School of Technology and Business Studies, Statistics.
Dalarna University, School of Technology and Business Studies, Information Systems.ORCID iD: 0000-0003-4871-833X
Dalarna University, School of Technology and Business Studies, Computer Engineering.ORCID iD: 0000-0003-1015-8015
2015 (English)In: Operations Research Perspectives, ISSN 2214-7160, Vol. 2, no 124, 132Article in journal (Refereed) Published
Abstract [en]

Regarding the location of a facility, the presumption in the widely used p-median model is that the customer opts for the shortest route to the nearest facility. However, this assumption is problematic on free markets since the customer is presumed to gravitate to a facility by the distance to and the attractiveness of it. The recently introduced gravity p-median model offers an extension to the p-median model that account for this. The model is therefore potentially interesting, although it has not yet been implemented and tested empirically. In this paper, we have implemented the model in an empirical problem of locating vehicle inspections, locksmiths, and retail stores of vehicle spare-parts for the purpose of investigating its superiority to the p-median model. We found, however, the gravity p-median model to be of limited use for the problem of locating facilities as it either gives solutions similar to the p-median model, or it gives unstable solutions due to a non-concave objective function.

Place, publisher, year, edition, pages
Elsevier, 2015. Vol. 2, no 124, 132
Keyword [en]
p-median model, distance decay, market share, network, retail, simulated annealing, travel time
National Category
Discrete Mathematics Economic Geography
Research subject
Complex Systems – Microdata Analysis, General Microdata Analysis - retail; Complex Systems – Microdata Analysis, General Microdata Analysis - methods; Complex Systems – Microdata Analysis, General Microdata Analysis - transports
Identifiers
URN: urn:nbn:se:du-17767DOI: 10.1016/j.orp.2015.06.002OAI: oai:DiVA.org:du-17767DiVA: diva2:819124
Funder
Swedish Retail and Wholesale Development Council
Available from: 2015-06-10 Created: 2015-06-10 Last updated: 2016-05-31Bibliographically approved

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CiteExportLink to record
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Citation style
  • apa
  • harvard1
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  • Other locale
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