Value-at-Risk model for hazardous material transportation

Value-at-Risk and Conditional Value-at-Risk Minimization for Hazardous Materials Routing

“…In the later paper the VaR and CVaR models are used to address the problem of minimizing the risk rising from short product lifestyles and high uncertainty concerning the demand in the electronics industry. In addition, the concepts of VaR and CVaR have been recently applied in hazmat transportation (Kang et al, 2013(Kang et al, , 2011Kwon, 2011). However the application of these models is significantly different than the models used in finance.…”

“…Now, we provide the properties of the VaR model for the extreme values of the confidence level α. Proofs are found in Kang et al (2013).…”

Generalized route planning model for hazardous material transportation with VaR and equity considerations

“…To overcome the drawback associated with the reliance on the availability and the accuracy of hazmat accident statistics, Kang et al [22] have introduced the Value-at-Risk (VaR) concept as it applies to hazmat routing and risk assessment. VaR provides a flexible decision making tool that covers various risk preferences.…”

“…While Kang et al [22] focused on a single trip case, we define a trip as a shipment carrying a type of hazmat from an origin to a destination. In this paper, we expand on the work of Kang et al [22] in two significant directions.…”

“…In this paper, we expand on the work of Kang et al [22] in two significant directions. First, we demonstrate its application to the multi-trip, multi-hazmat situation while considering equity as a constraint.…”