Revenue Management and E-Commerce
Management Science
Decision Support for Consumer Direct Grocery Initiatives
Transportation Science
Revenue management: models and methods
Proceedings of the 40th Conference on Winter Simulation
Robust Controls for Network Revenue Management
Manufacturing & Service Operations Management
Computing Time-Dependent Bid Prices in Network Revenue Management Problems
Transportation Science
Dynamic control mechanisms for revenue management with flexible products
Computers and Operations Research
Revenue management: models and methods
Winter Simulation Conference
Network capacity management under competition
Computational Optimization and Applications
Designing Mechanisms for the Management of Carrier Alliances
Transportation Science
Cargo Capacity Management with Allotments and Spot Market Demand
Operations Research
Simulation-based methods for booking control in network revenue management
Proceedings of the Winter Simulation Conference
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We analyze a randomized version of the deterministic linear programming (DLP) method for computing network bid prices. The method consists of simulating a sequence of realizations of itinerary demand and solving deterministic linear programs to allocate capacity to itineraries for each realization. The dual prices from this sequence are then averaged to form a bid price approximation. This randomized linear programming (RLP) method is only slightly more complicated to implement than the DLP method. We show that the RLP method can be viewed as a procedure for estimating the gradient of the expected perfect information (PI) network revenue. That is, the expected revenue obtained with full information on future demand realizations. The expected PI revenue can, in turn, be viewed as an approximation to the optimal value function. We establish conditions under which the RLP procedure provides an unbiased estimator of the gradient of the expected PI revenue. Computational tests are performed to evaluate the revenue performance of the RLP method compared to the DLP.