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A binary differential evolution algorithm for airline revenue management: a case study

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Abstract

In the current highly competitive airline market, many companies have failed due to their low revenue rates. For this reason, many of them have to develop strategies to increase their revenue. In this study, we develop revenue management (RM) strategy for the Iranian airline industry. More specifically, we present a mathematical model that considers some conditions not studied in previous research in order to provide a more realistic RM modeling of airlines that fits well for the special characteristics of Iranian Airways. A binary differential evolution algorithm is employed to solve the model due to the stochastic nature of data and the NP-hardness of the considered problem. To generate maximum revenue among the six types of airplanes that fly the four capital cities of Iran, the airline under investigation is advised to operate only 21 flights to those cities and cancel the rest of the flights.

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Acknowledgements

The authors would like to thank the anonymous reviewers and the editor for their insightful comments and suggestions.

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Authors and Affiliations

  1. Young Researchers and Elite Club, South Tehran Branch, Islamic Azad University, Tehran, Iran

    Amir Karbassi Yazdi

  2. Department of Electrical and Computer Engineering, KIOS Research and Innovation Center of Excellence, University of Cyprus, Nicosia, Cyprus

    Mohamad Amin Kaviani

  3. Institute for Information Systems, University of Applied Sciences and Arts Northwestern Switzerland, Olten, Switzerland

    Thomas Hanne

  4. Instituto de Investigación Tecnológica, Escuela Técnica Superior de Ingeniería, Universidad Pontificia Comillas, 28015, Madrid, Spain

    Andres Ramos

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  1. Amir Karbassi Yazdi
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  2. Mohamad Amin Kaviani
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  3. Thomas Hanne
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Correspondence to Thomas Hanne.

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Karbassi Yazdi, A., Kaviani, M.A., Hanne, T. et al. A binary differential evolution algorithm for airline revenue management: a case study. Soft Comput 24, 14221–14234 (2020). https://doi.org/10.1007/s00500-020-04790-2

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