Tsai, Mei-Ting; Saphores, Jean-Daniel; Regan, Amelia - In: Transportation Research Part E: Logistics and … 47 (2011) 6, pp. 920-932
This paper applies concepts from the theory of Real Options to hedge uncertainty in transportation capacity and cost using derivative contracts, called truckload options. We make three contributions. First, we provide a closed-form pricing formula for basic truckload options when the truckload...