Chile‘s school system is using mathematical modeling to assign catering contracts in a single round sealed-bid combinational auction. The Chilean state spends around US$180 million a year to feed 1,300,000 students from low income families, making this one of the largest state auctions. To improve the quality of the assignment in the auction process, we constructed an integer linear programming model to decide contract awards optimally among different concession holders. The model completely changed the nature of the process in three crucial aspects. First, it gave transparency and objectivity to the complete process, generating competition among firms. Second, it allowed the companies to build flexible territorial bids to include their scale economies, leading to efficient resource allocation. Finally, the model indeed found an optimal solution, which is not easy because the assignment problem was NP-complete with more than 10,000 binary variables. This new methodology improved the price-quality ratio of the meals with yearly savings of around US$40 million—equivalent to the cost of feeding 300,000 children during one year.
-
Faculty
- Academic Areas
- Awards & Honors
- Seminars
-
Conferences
- Accounting Summer Camp
- California Econometrics Conference
- California Quantitative Marketing PhD Conference
- California School Conference
- China India Insights Conference
- Homo economicus, Evolving
-
Initiative on Business and Environmental Sustainability
- Political Economics (2023–24)
- Scaling Geologic Storage of CO2 (2023–24)
- A Resilient Pacific: Building Connections, Envisioning Solutions
- Adaptation and Innovation
- Changing Climate
- Civil Society
- Climate Impact Summit
- Climate Science
- Corporate Carbon Disclosures
- Earth’s Seafloor
- Environmental Justice
- Finance
- Marketing
- Operations and Information Technology
- Organizations
- Sustainability Reporting and Control
- Taking the Pulse of the Planet
- Urban Infrastructure
- Watershed Restoration
- Junior Faculty Workshop on Financial Regulation and Banking
- Ken Singleton Celebration
- Marketing Camp
- Quantitative Marketing PhD Alumni Conference
- Rising Scholars Conference
- Theory and Inference in Accounting Research
- Voices
- Publications
- Books
- Working Papers
- Case Studies
-
Research Labs & Initiatives
- Cities, Housing & Society Lab
- Corporate Governance Research Initiative
- Corporations and Society Initiative
- Golub Capital Social Impact Lab
- Policy and Innovation Initiative
- Rapid Decarbonization Initiative
- Stanford Latino Entrepreneurship Initiative
- Value Chain Innovation Initiative
- Venture Capital Initiative
- Behavioral Lab
- Data, Analytics & Research Computing