Rerouting to Evade Tariffs - Our Latest Study

Tariffs and their impacts we have been researching for several decades now because of the relevance of the topic as well as the scientific interest in the mathematical modeling of supply chain networks and international trade. Furthermore, there are different types of tariffs, including unit tariffs, ad valorem tariffs, and even tariff rate quotas. We have studied the impacts of tariffs in perfectly competitive contexts such as spatial price equilibrium problems as well as in oligopolistic markets.

Recently, because of the escalating trade wars and imposition of various retaliatory tariffs in the second Trump administration, our research has included rerouting to evade tariffs. This topic has been quite newsworthy; see, for example, this article in The New York Times, which was published today: https://www.nytimes.com/2025/05/24/business/vietnam-china-transshipment.html

My paper, "Multicommodity Trade, Tariffs, and Rerouting," co-authored with my Isenberg School PhD student, Samirasadat "Samira" Samadi, was accepted in the very special volume: Convex and Variational Analysis with Applications: In Honor of Terry Rockafellar’s 90th Birthday. Panos M. Pardalos and Themistocles M. Rassias, Editors, Springer Nature Switzerland AG.

It was an honor to have been invited to contributed to this edited volume in honor of the amazing Professor Rockafellar, a giant in the optimization and variational inequalities.

A preprint of our paper can be downloaded from the Supernetwork Center website: https://supernet.isenberg.umass.edu/articles/MulticommodityTradeTariffsandRerouting.pdf

The case study in the paper focuses on tea, which is produced in both China and Vietnam, and, in our numerical examples, can be rerouted, with associated additional costs (although it is illegal) to demand markets. It is important to model and to quantify trade-offs associated with such illicit tariff evasion in order to provide policy- and decision-makers with insights for interdiction purposes. Our research continues.

Mathematics of Planet Earth -- Special Issue of Computational Management Science

According to the website for Mathematics of Planet Earth MPE2013: More than a hundred scientific societies, universities, research institutes, and organizations all over the world have banded together to dedicate 2013 as a special year for the Mathematics of Planet Earth.

 The theme “Mathematics of Planet Earth” is interpreted as broadly as possible. In addition to climate change and sustainability, it includes geophysics, ecology and epidemiology, biodiversity, as well as the global organization of the planet by humans. The different topics have been classified into four themes.

The four themes of MPE2013:
* A PLANET TO DISCOVER: oceans; meteorology and climate; mantle processes, natural resources, solar systems
* A PLANET SUPPORTING LIFE: ecology, biodiversity, evolution
* A PLANET ORGANIZED BY HUMANS: political, economic, social and financial systems; organization of transport and communications networks; management of resources; energy
* A PLANET AT RISK: climate change, sustainable development, epidemics; invasive species, natural disasters.

I became aware of this great initiative last May when I spoke at the Computational Management Science conference in Montreal, Canada,  and heard from Professor Georges Zaccour that he, and Professor Michele Breton, were guest editing a special issue of the journal Computational Management Science on this theme.  Since last year I was on sabbatical and spending a lot of time at the School of Business, Economics and Law at the University of Gothenburg in Sweden, sustainability continues to be a major theme in my research. Plus, the emphasis on the environment in Gothenburg and in Sweden, overall, made for a perfect venue in which to work on a paper for this special issue. Our paper, Supply Chain Network Sustainability Under Competition and Frequencies of Activities from Production to Distribution, Anna Nagurney, Min Yu, and Jonas Floden, is now in press in this special issue  of Computational Management Science.

I was delighted to see the Preface to this special issue online on the journal website  The special issue, according to the Guest Editors Breton and Zaccour,  has 7 papers written by scholars having an extensive expertise in mathematical modeling and in environmental issues.The objective of this issue is to report on recent advances in modeling and in the development of computational methods for environmental issues such as global warming, pollution control, adaptation, sustainable exploitation of resources (forests, fisheries, etc(, sustainable supply chains, and more!

I expect that the hardcopy of the full issue will be produced soon since the contributions are online -- I am so looking forward to receiving my copy.

Congrats to the Guest Editors and thank you for your hard work which made this special volume possible! Also, thanks to the long-serving Editor of CMS, Professor Berc Rustem, for being a visionary.

Should Pharmaceutical Production be Outsourced -- Competing on Quality

With the 2013 INFORMS Healthcare Conference in full swing in Chicago, I thought it appropriate to highlight some recent research on quality competition and the outsourcing of the production of pharmaceuticals (medicines).

Medicines are essential to healing and, hence, their quality is paramount to health.

I have written on healthcare supply chains on this blog on multiple occasions from the broken humanitarian healthcare supply chain to medical nuclear supply chains to advanced analytics for pharmaceutical supply chains.  Our book, Networks Against Time: Supply Chain Analytics for Perishable Products, published by Springer in 2013, contains several chapters focused on healthcare supply chains.

And, my most recent PhD student at the Isenberg School of Management, in Management Science,  Amir H. Masoumi, successfully defended his dissertation entitled Supply Chain Management  of Perishable Products with Applications to Healthcare, so clearly there is also great interest in healthcare applications among our students. My interest in healthcare supply chains, grew in part, because of the work with Amir, beginning with blood supply chains, which was a special interest of his.

Professor Hari Balasubramanian, who is the Program Chair of the 2013 INFORMS Healthcare Conference, was on Amir's doctoral dissertation committee.

Most recently, we have been researching quality competition, beginning with the paper, A Dynamic Network Oligopoly Model with Transportation Costs, Product Differentiation, and Quality Competition, Anna Nagurney and Dong Li, which is in press in the journal, Computational Economics.

Given the importance of healthcare and pharmaceuticals, as well as the growth in the outsourcing of pharma production globally, along with numerous issues raised in terms of quality, it was important to investigate how math modeling could contribute to issues of quality, reputation, outsourcing, and competition.

Our paper, Pharmaceutical Supply Chain Networks with Outsourcing Under Price and Quality Competition,
Anna Nagurney, Dong Li, and Ladimer S. Nagurney, is now in press in the journal, International Transactions in Operational Research. This paper quantifies the effects of quality levels on a firm's reputation and develops a game theory model of outsourcing for a pharmaceutical firm. We developed both a static version (at the equilibrium state) and a dynamic version to illustrate how the quantity and quality levels evolve over time. We utilized variational inequality theory for the former and projected dynamical systems for the latter.

Math modeling, operations research (O.R.), and analytics are contributing tremendously to the understanding of healthcare issues in our society. Doing Good  with Good O.R. continues as a theme of our profession.

Computer Programming is Good for the Brain and the Soul

Being creative is part of our DNA.

Some of us are artists, musicians, scientists, writers, educators, technologists and engineers, leaders of corporations, doctors and nurses, and/or entrepreneurs.

Being creative requires focus to accomplish the task and in this world of increasing distractions and interruptions (some of it caused by advances in computer technology) I argue that computer programming is good for the brain and for the soul.

Computer programming requires precision, attention to detail, creativity in terms of identifying the appropriate data structures and the design of the software, and knowledge of the underlying algorithm(s), whether developed by you or by someone else. You need to have patience and stamina and having curiosity also helps. I am always eager to see how the software programs that I develop will work. We strive for correctness of our codes and of the algorithms that we implement, with the realization that, even if initially developed as research, they may eventually be applied to solve problems ranging from those in transportation, energy, and infrastructure, to healthcare, supply chains, financial analysis, and even disaster planning and management.

In writing a computer program you are creating something that is useful and something that may be quite novel and original.

I have written previously about the importance of including computer programming in curricula and hope that every child before graduating from high school gets a chance to explore the power (and joy) of computer programming. Such experiences would add to a deeper understanding of technology and the underlying algorithms and would create, I believe, a richer appreciation of mathematics and its role in our world today.


Recently, I have been working on different computer programs (software codes) for game theory problems in applications ranging from the redesign of the Internet, on a project funded by NSF,  to competition in supply chain networks with outsourcing. There is great satisfaction in seeing the mathematical models that one develops and implements algorithms for actually being solved with code that you have programmed yourself. It is very rewarding to see your focus and efforts resulting in what is a type of product. One can then also address and answer so many interesting questions through simulations!

Hence, computer programming is good for the soul, too!

Stockholm and the Royal Institute of Technology in Sweden

We took the high speed train from Gothenburg to Stockholm on Sunday and returned yesterday evening riding in a first class compartment. During the train rides the scenery of lakes, birch forests, and rolling green hills made for a perfect backdrop against which we relaxed and caught up with a lot of reading. Yesterday, since we were riding in the first class train car, which was worth the extra 10 dollars or so per ticket,  we even got served  hot drinks and brownies and there was fresh fruit available at the head of the car.


As I had written in my previous post, I had been invited to give a talk at the Royal Institute of Technology (KTH) in Stockholm, an invitation that I could not refuse.

My host was Professor Lars-Goran Mattsson who is head of the Department of Transport at KTH. I was treated to a delicious lunch, got to see such colleagues as Dr. Po Lindberg, who had recently earned his second PhD and has made academic history, as well as Dr. Leonid Engelson, and to meet another guest speaker that day, Dr. John Abraham from Calgary in Canada. What a coincidence that the speakers were both born in Canada!

With my talk on Perishable Product Supply Chains in Healthcare and John's presentation afterwards on Spatial Interaction Modeling, we had a mini-workshop with many great questions and discussions. Given that the date was June 18 and that Swedes are soon celebrating Midsommer, a big holiday, which they take very seriously, it was terrific to see such an engaged audience.

We discussed math modeling issues and possible extensions along with short term and long term equilibria as well as the importance of time and time scales. I was more focused on a particular sector -- that of healthcare, whereas John was describing his work on the city level and his project with the city of Baltimore.

To see research with both theoretical content and practical implications is very exciting to me, as an operations researcher, network scientist, and computational economist. Yes, I believe in algorithms and not purely closed form solutions for problems, because the data can be messy and the functions not simple.

Since my husband and daughter had come to visit me in Gothenburg, where I am now a Visiting Professor of Operations Management, and we had lived in Stockholm of three different occasions, we had a chance to explore the city as well.

After I return to the US, I will post many photos of Stockholm. Stockholm has resurrected one of its tram lines, which is great. In Gothenburg, trams snake through the city and are a marvel to watch and are just one form of the public transportation modes in this second largest city on Sweden.

It was interesting to see that the new transport links that will change the freight flows (with many trucks) around the Wenner Gren Center, where we have lived, should be completed around 2015. We also noticed the increase in traffic, with more honking, as well as the increase in the pace of life in Stockholm (which my Gothenburg colleagues had told me about) since we last lived in  Stockholm a decade ago.

Nevertheless, my daughter's favorite restaurant, Cyprus, was still there, as was our favorite pastry shop, complete with the Princess tortes.

We even peaked through the gates to the daghis (Swedish daycare) to which she had gone and dined for lunch of salmon, carrots and dilled potatoes. Yes, in Sweden, the daycares have chefs and cooks!

The beauty of Stockholm, with the water, the greenery, and the architecture of the buildings lining the archipelagos is breathtaking.

We even had a chance to visit the Museum of Modern Art with a Yoko Ono exhibition.

Last night, when we returned to Gothenburg, Sweden beat France in Euro 2012 with a score of 2-0. However, it still did not make the quarterfinals of this fabulous soccer series, which is taking place in Poland and Ukraine. Ukraine, however, lost, because Rooney of England scored the goal.

It has been a series of blue and gold and it has been fabulous to follow the soccer games here in Europe. I have been getting personal updates from Ukraine from a colleague and a former doctoral student of mine who is Ukrainian.

Optimizing Blood Supply Chains for Healthcare

Our paper, Supply Chain Network Operations Management of a Blood Banking System with Cost and Risk Minimization, Anna Nagurney, Amir H. Masoumi, and Min Yu, now appears in the journal, Computational Management Science 9(2): (2012) pp 205-231.

It is in the April 2012 issue of Computational Management Science and is in a special issue edited by Professor Georg Pflug.

In this paper, we focus on a specific perishable product – that of human blood – and the optimization of a blood banking network system. Nahmias (1982) claimed that: “The interest among researchers in perishable inventory problems has been sparked primarily by problems of blood bank management. Some of the possible reasons for this interest might be that blood bank research has been supported by public funds.” Prastacos (1984) provided a review, to that date, of blood inventory management, from both theoretical and practical perspectives. Whether or not Nahmias’ statement is still valid – considering all the recent concerns about the safety of perishable products, blood bank management from a supply chain network perspective merits a fresh and updated approach.

This topic is especially timely today, since it has been reported that the number of disasters and the number of people affected by disasters has been growing over the past decade and blood is certainly a life-saving product (cf. Nagurney and Qiang (2009)). Blood service operations are a key component of the healthcare system all over the world. According to the American Red Cross, over 39,000 donations are needed everyday in the United States, alone, and the blood supply is frequently reported to be just 2 days away from running out. Of 1,700 hospitals participating in a survey in 2007, a total of 492 reported cancellations of elective surgeries on one or more days due to blood shortages. While for many hospitals, the reported number of blood-related delays was not significant, hospitals with as many days of surgical delays as 50 or even 120 have been observed. Furthermore, in 2006, the national estimate for the number of units of whole blood and all components outdated by blood centers and hospitals was 1,276,000 out of 15,688,000 units (Whitaker et al. (2007)). Considering also the ever-increasing hospital cost of a unit of red blood cells with a 6.4% increase from 2005 to 2007 further highlights the criticality of this perishable, lifesaving product.

 
In the US, this criticality has become more of an issue in the Northeastern and Southwestern states since this cost is meaningfully higher compared to that of the Southeastern and Central states. Moreover, hospitals were responsible for approximately 90% of the outdates, with this volume of medical waste imposing discarding costs to the already financially-stressed hospitals (The New York Times (2010)).

In this paper, we developed a generalized network optimization model for the complex supply chain of human blood, which is a life-saving, perishable product. In particular, we considered a regionalized blood banking system consisting of collection sites, testing and processing facilities, storage facilities, distribution centers, as well as points of demand, which, typically, include hospitals.

Our multicriteria system-optimization approach on generalized networks with arc multipliers captures many of the critical issues associated with blood supply chains such as the determination of the optimal allocations, and the induced supply-side risk, as well as the induced cost of discarding the waste, while satisfying the uncertain demands as closely as possible.

The framework that we present in this paper is also applicable, with appropriate modifications, to the
optimization of other supply chains of perishable products.


The complete analysis, along with references, can be found in our paper.

The Bridge Will be Torn Down and a Gorgeous Old House Was, Too

I have been writing this blog about infrastructure, networks, research, and education since I began the RENeW blog in January 2009. The blog was initiated for two reasons: 1. because I had been approached by a good number of people to start one and 2. I was finishing writing the Fragile Networks book with Patrick Qiang and blogging was a way in which to get news out and to also inform. Being an educator means keeping ties to students, even after they graduate, and to numerous colleagues and interested individuals, and this means of communication seems especially timely.

Throughout this semester, while teaching my undergrad transportation & logistics class, the students and I discussed associated events as they were occurring in the real world, from the closure of the San Francisco Bay bridge to the closure of the Lake Champlain bridge, along with the engineering, economic, and business consequences. We talked about passengers who were stranded on airport tarmacs for hours on planes before their release. We talked and learned about transportation modes and their variants around the globe. We came to truly appreciate the importance of transportation and logistics as networks that tie us all.

These and other stories continue as we near the New Year with President Obama passing a regulation that airlines on national flights cannot keep passengers on planes on the tarmac for longer than three hours without large financial penalties. Ah, the math modeling possibilities that now present themselves and colleagues in transportation and operations research have been recently quoted in the press on the associated scheduling and rescheduling issues and possible ramifications! However, all of my "stuck on the tarmac for 4 hours" stories have involved international flights so I guess I am not off the hook.

At the same time, we are reading about passengers being trapped in the Eurochunnel for hours with the Eurostar train shutting operation for days because of, supposedly, "unusually powdery snow entering the engines." In addition, due to a power failure yesterday, Amtrak had to shut train operation in parts of the Northeast yesterday for hours (during one of the busiest travel seasons of the year). Nevertheless, another theme for one of my blog posts was that of Boeing's production problems, which, for the time being, seem to have been now resolved, with the new Boeing 787 Dreamliner recently soaring over Washington state (2 years late but at least it can get up and fly now) . This is a fascinating case study on outsourcing and what happened.

The New York Times is now reporting in this NY Times Bridge Article that the Lake Champlain bridge that joins Vermont with New York State will not be repaired but rather will be imploded next Monday! The article demonstrates the huge impact on the communities from, first, the closure of this bridge last October and now with the heart-breaking news that this bridge will be destroyed. A lifeline for citizens is lost as well as an elegant (but one which needed lots of repairs) structure. I wrote about the closure of this bridge in a letter to the editor that was published in the Boston Globe last month.

Last March we traveled to Austria, since I was invited to give a seminar at the Vienna University of Business and Economics. We landed first in Innsbruck, where we spent a few days since we wanted to reconnect and see friends and townfolks that we had interacted with back in 2002 while I held a Distinguished Chaired Fulbright at the University of Innsbruck. During our 4 month stay in Innsbruck we lived in the house featured above in the first photo, which was owned by a professor at the university. The address was 94 Schneeburgasse. We had heard that the house had been sold and condos had replaced this magical villa with views of the Alps and the 1964 Olympics ski jump.

We wandered to see our former neighbors on Schneeburgasse last March and were welcomed with hugs. Above I also include the photo of the condo complex that replaced the villa (with several of the units not filled).

Let's take great care when we destroy the old. Beauty in design and function should be preserved also for its living history.

Now, we will have to just make do with some photos and incredible memories -- the same holds for those whose lives have been forever changed because of the removal of the Champlain bridge.