Airline revenue management games with simultaneous price and quantity competition
Airline revenue management games with simultaneous price and quantity competition
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DOI:
10.1016/j.cor.2016.05.008
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发表时间:
2016-11
期刊:
影响因子:
--
通讯作者:
W. Grauberger;A. Kimms
中科院分区:
文献类型:
--
作者:
W. Grauberger;A. Kimms
This paper treats airline revenue management under simultaneous price and quantity competition in a network. Within this setting, a competitor's demand is a function of his price as well as the competitor's price and booking limits. We present a model to optimize a competitor's behavior in a network revenue management game. To the best of our knowledge, our model is the first of this type. We also present an approach to compute a possibly approximate Nash equilibrium in the game assuming that the competitors make decisions based on our model. Since the model is non-linear, we compute equilibrium prices and booking limits separately. The procedure's performance is shown in a computational study. When both price competition and quantity competition are taken into account, prices as well as demands tend to increase leading to higher revenues compared to monopolistic prices.