Alternative risk-averse approaches for airline network revenue management

Terciyanli, Erman
Avşar, Zeynep Müge
In this study, seat inventory control is considered for airline networks. Alternative optimization models are proposed for risk-averse decision makers by incorporating the following measure: lower-semideviation of revenue from a given threshold level or expected revenue. Performance of the proposed models is tested in a simulation model for a sample network under different scenarios by using a nesting heuristic and simulating arrival pattern of the airline demand.


Alternative mathematical models for revenue management problems
Terciyanlı, Erman; Avşar, Zeynep Müge; Department of Industrial Engineering (2009)
In this study, the seat inventory control problem is considered for airline networks from the perspective of a risk-averse decision maker. In the revenue management literature, it is generally assumed that the decision makers are risk-neutral. Therefore, the expected revenue is maximized without taking the variability or any other risk factor into account. On the other hand, risk-sensitive approach provides us with more information about the behavior of the revenue. The risk measure we consider in this stud...
A risk-sensitive approach for airline network revenue management problems
Çetiner, Demet; Köksalan, Murat; Department of Industrial Engineering (2007)
In this thesis, airline network revenue management problem is considered for the case with no cancellations and overbooking. In literature, there exist several approximate probabilistic and deterministic mathematical models developed in order to maximize expected revenue at the end of the reservation period. The aim of this study is to develop models considering also the risks involved in the proposed booking control policies. Two linear programming models are proposed which incorporate the variance of the ...
Integrated aircraft and passenger recovery with cruise time controllability
Arikan, Ugur; Gürel, Sinan; Akturk, M. Selim (Springer Science and Business Media LLC, 2016-01-01)
Disruptions in airline operations can result in infeasibilities in aircraft and passenger schedules. Airlines typically recover aircraft schedules and disruptions in passenger itineraries sequentially. However, passengers are severely affected by disruptions and recovery decisions. In this paper, we present a mathematical formulation for the integrated aircraft and passenger recovery problem that considers aircraft and passenger related costs simultaneously. Using the superimposition of aircraft and passeng...
Optimization of ride comfort for vehicles equipped with passive and active hydro-pneumatic suspensions
Sağlam, Ferhat; Ünlüsoy, Yavuz Samim; Department of Mechanical Engineering (2016)
The main objective of this study is the optimization of ride comfort performance of vehicles equipped with Hydro-Pneumatic (HP) suspension systems. In order to improve ride comfort performance together with handling behavior as a constraint, active-passive, and unconnected-interconnected HP suspension systems are included in the study. The basic HP suspension model is developed and validated by experiments. Various HP suspension systems of increasing complexity are modeled, and their dynamic characteristics...
Approximation of sell-out probability to estimate expected marginal value of capacity
Selçuk, Ahmet Melih; Avşar, Zeynep Müge (Elsevier BV, 2020-01-01)
© 2020 Elsevier LtdIn this study, the dynamic pricing problem is considered for single-leg airline revenue management. The dynamic programming formulation given for this problem is expressed in terms of the expected marginal revenue of capacity. In order to make the formulation applicable in practice, approximations are proposed in this study for estimating the expected marginal revenue term. Numerical tests based on simulating the sales process show that the proposed approximations work well as compared to...
Citation Formats
E. Terciyanli and Z. M. Avşar, “Alternative risk-averse approaches for airline network revenue management,” TRANSPORTATION RESEARCH PART E-LOGISTICS AND TRANSPORTATION REVIEW, pp. 27–46, 2019, Accessed: 00, 2020. [Online]. Available: