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Data · dataset · 2003

Modeling Airline Competition with Alliance

Listed in Harvard Dataverse

Since1987, the deregulation of the airline industry, all major domestic airline companies have faced enormous competition in order to secure its market share and accumulate maximum profit.

Description

Many have questioned that the quality of the domestic airline industry has not been improved. The reason is because of the keen competition between many flight carriers.

Others have suggested the authority to encourage airline merging in order to reduce the negative impact in the market. However, the hypothesis of this research is that by the means of cooperation, the operation proficiency, flight safety, and service quality could be improved. As the matter of the fact, the focus of this research is to construct a proper pricing model through the analysis of the current existed alliances.

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The reviews of the literature in the application of the alliances as the cooperative games will be carefully synthesized by discuss the definition and the resolution process of Core, Shapley value and Nucleolus. The practice of the pool in the current cooperative market will also be illustrated through the construction of the payoff function and the solution to of market equilibrium under. Three major components of the payoff function are as followed: the demand model, the market share model, and the cost model.

After the completion of the payoff function, this research uses theory of the cooperative game to find the most profitable price under different scenarios. Based on the profitable prices, the payoff values that correspond with the maximum profits, of the airline companies are obtained. To conclude this research, a case study of a domestic market is presented to verify the effectiveness of this model.

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Provenance · 1 source records, 5 field assertions
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Harvard Dataversedoi:10.6141/TW-SRDA-E88135-115 d agoJSON v1
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