As emphasized throughout the text, the main difficulty in solving bilevel programs stems from their inherent nonconvexity and nondifferentiability. This is true even for the simplest of forms where all the functions are linear and all the variables are continuous. Although exact approaches, such as those based on the Kuhn-Tucker conditions of the follower’s problem or on variable elimination, handle the nonconvexity in different ways, their success has been limited. We are still only able to solve moderate size problems. Heuristics, and what have become known as global optimization techniques, offer additional possibilities.
KeywordsGenetic Algorithm Tabu Search Grid Search Bilevel Program Global Optimization Technique
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