Analysis and Evaluation of Incentive Compatible Dynamic Mechanisms for Carrier Collaboration

Abstract

This paper introduces a framework for carrier dynamic collaboration. In particular it proposes and analyzes dynamic collaborative mechanisms that are incentive compatible. The dynamic collaborative environment is characterized by a set of carriers that have a proprietary set of customers that generate a stream of random demands over time. The proposed collaborative mechanism is such that upon each demand arrival, each carrier has the incentive to submit the arrived shipment or service request to the collaborative mechanism. Intuition about the efficiency and workings of the collaborative mechanism is developed. A general framework to formulate and study collaborative frameworks among transportation carriers is proposed. A truckload pickup-and-delivery collaborative environment is simulated and results are analyzed.