Scalable Dynamic Bid Prices for Network Revenue Management in Continuous Time

• 成果类型: Article
• 署名作者: Kirshner, Samuel Nathan; Nediak, Mikhail
• 署名单位: Queens University - Canada
• 刊物名称: PRODUCTION AND OPERATIONS MANAGEMENT
• ISSN/ISSBN: 1059-1478
• DOI: 10.1111/poms.12356
• 发表日期: 2015
• 页码: 1621-1635
• 关键词: Network Revenue Management; dynamic bid prices; second-order cone programming

摘要

This study develops an approximate optimal control problem to produce time-dependent bid prices for the airline network revenue management problem. The main contributions of our study are the analysis of time-dependent bid prices in continuous time and the use of splines to modify the problem into an approximate second-order cone program (ASOCP). The spline representation of bid prices permits the number of variables to depend solely on the number of resources and not on the size of the booking horizon. The advantage of this framework is the ASOCP's scalability, which we demonstrate by solving for bid prices on an industrial-sized network. The numerical experiments highlight the ASOCP's ability to solve industrial sized problems in seconds.