An integrated financial and logistical game theory model for humanitarian organizations with purchasing costs, multiple freight service providers, and budget, capacity, and demand constraints

A Stochastic Disaster Relief Game Theory Network Model

“…Hence, the authors utilized a variational equilibrium concept to provide a variational inequality formulation of the governing equilibrium conditions of their model. Nagurney, Salarpour, and Daniele [49], subsequently, brought additional realism to the model of [43]. In that game theory model, the purchasing of products was added to the costs that humanitarian organizations may face in disaster relief with the HOs also having the option of selecting among different purchasing locations, local or nonlocal, with the consideration of different associated prices and shipping costs.…”

“…Game theory for freight services associated with disaster relief has been a specific research theme that has been addressed in a number of recent papers. As noted in [41,49], they introduced a multi-tiered disaster relief network equilibrium model of humanitarian organizations and freight service providers. In that model, the supplies were pre-positioned supplies and the demands for relief item deliveries were known and fixed.…”

“…Our paper hopes to fill this gap in the literature, while also advancing the development of game theory models that integrate the financial and logistical sides associated with disaster response of humanitarian organizations. Hence, this paper builds on the work of [42,43], and [49] but with the following significant extensions/modifications: 1. Each decision-maker is faced with a two-stage stochastic optimization problem.…”

“…As noted in [50] and in [49], one may take advantage of a refinement of the GNE known as a Variational Equilibrium, which is a specific type of GNE (cf. [30]), and which enables a variational inequality formulation.…”

“…Government assets, as was the case post the Haiti 2010 earthquake, may also be severely compromised. Therefore, humanitarian organizations, both national and, in many major disasters, international ones, as well, come to assist [49]. The multiplicity of organizations that may be involved in disaster response may, in turn, lead to materiel convergence (too many of the wrong supplies in the wrong locations resulting in congestion and additional work for relief workers) and a lack of coordination, which may lead to unmet demand and, hence, increases in suffering and loss of life.…”