Lw. Robinson, OPTIMAL AND APPROXIMATE CONTROL POLICIES FOR AIRLINE BOOKING WITH SEQUENTIAL NONMONOTONIC FARE CLASSES, Operations research, 43(2), 1995, pp. 252-263
Citations number
25
Categorie Soggetti
Management,"Operatione Research & Management Science","Operatione Research & Management Science
This paper addresses the question of when to refuse discount bookings
from airline passengers to reserve seats for potential future passenge
rs who are willing to pay a higher fare. When passengers arrive in seq
uential fare classes, the optimal policy will be to accept reservation
requests as long as the cumulative seats booked does not exceed a giv
en booking limit. This paper relates the probability of filling the pl
ane, under the optimal policy, with the ratios of the current to the h
ighest remaining fare classes. In addition, it extends the solution fr
om monotonically increasing fares to fares occurring in arbitrary orde
r. Finally, it demonstrates how Monte Carlo integration is easy to use
to get arbitrarily close approximations to the optimal policy.