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ApplMathOptim(2010)62:229–252DOI10.1007/s00245-010-9102-0TheExchangeValueEmbeddedinaTransportSystemQinglanXia·ShaofengXuPublishedonline:12May2010©TheAuthor(s)2010.ThisarticleispublishedwithopenaccessatSpringerlink.comAbstractThispapershowsthatawelldesignedtransportsystemhasanembeddedexchangevaluebyservingasamarketforpotentialexchangebetweenconsumers.Undersuitableconditions,onecanimprovethewelfareofconsumersinthesystemsimplybyallowingsomeexchangeofgoodsbetweenconsumersduringtransporta-tionwithoutincurringadditionaltransportationcost.Weproposeanexplicitvalua-tionformulatomeasurethisexchangevalueforagivencompatibletransportsystem.Thisvalueisalwaysnonnegativeandboundedfromabove.Criteriabasedontrans-portstructures,preferencesandpricesareprovidedtodeterminetheexistenceofapositiveexchangevalue.Finally,westudyanewoptimaltransportproblemwithanobjectivetakingintoaccountofbothtransportationcostandexchangevalue.KeywordsExchangevalue·Branchingtransportsystem·Ramifiedoptimaltransportation·Utility1Int...