Article ID: | iaor2001827 |
Country: | United States |
Volume: | 33 |
Issue: | 2 |
Start Page Number: | 136 |
End Page Number: | 146 |
Publication Date: | May 1999 |
Journal: | Transportation Science |
Authors: | Stidham Shaler, Lautenbacher Conrad J. |
Keywords: | programming: dynamic, yield management |
We introduce the terms dynamic and static, respectively, to identify the prevailing approaches to the single-leg airline yield-management problem: those allowing customers of different fare classes to book concomitantly (dynamic), and those assuming that the demands for the different fare classes arrive separately in a predetermined order (static). We present a coherent framework linking these seemingly disparate models through the underlying dynamic program common to both. We develop a discrete-time Markov decision process formulation mirroring that of Janakiram