Abstract
In airline revenue management, capacity is usually assumed to be fixed. However, capacity changes are common in practice. This contribution quantifies the value of information when systematically considering possible capacity changes in revenue optimization. It solves a stochastic model that anticipates capacity changes, given different levels of information. A computational study compares solution approaches with respect to the resulting revenue, seat load factor, and denied boarding.
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Acknowledgements
We thank Lufthansa German Airlines for access to empirical data.
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Kadatz, D., Kliewer, N., Cleophas, C. (2018). Exogenous Capacity Changes in Airline Revenue Management: Quantifying the Value of Information. In: Fink, A., Fügenschuh, A., Geiger, M. (eds) Operations Research Proceedings 2016. Operations Research Proceedings. Springer, Cham. https://doi.org/10.1007/978-3-319-55702-1_57
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DOI: https://doi.org/10.1007/978-3-319-55702-1_57
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