Skip to main content



The United Airlines Fiasco: How Game Theory Could Help

Six months ago, everyone was talking about the passenger who got dragged off the United Airlines flight, left bruised and bloodied. People had feelings and thoughts of disgust, rage and anger. But what very few people thought about was how the airline industry is actually a game.

So how is the airline industry a game? Airlines overbook their flights with the assumption that people will not show up. They have to determine how many seats to sell by estimating how many people they think will not show up. Obviously, this changes from flight to flight, and there is no truly accurare way to assess this. Sometimes it works out and other times it doesn’t. Regardless, though, it should never end with a passenger being dragged off the plane left with missing teeth and broken bones.

How can this game be redesigned to improve how airlines respond to issues that arise? The article offers a few suggestions. One is to ask passengers to give up their seast prior to boarding the plane because people hold items at a greater value once you already have it. The article also advises to not make the offer in public because of societal stigmas and reactions. Lastly, it suggests to start with a high offer and work down to assess the best people to ask to leave the flight. If a person won’t take a high offer, he or she most likely needs to get to where they need to go as soon as possible. Those are the people you do not want to “drag” off the flight if you can help it.

“Game theory is concerned with situations in which decision-makers interact with one another, and in which the happiness of each participant with the outcome depends not just on his or her own decisions but on the decisions made by everyone” (Easley and Kleinberg, 2010). In the case of the of the United Airlines incident, the decision-makers are the passengers and the airline. The airline has to decide how many seats to sell, if the plane is overbooked which passenger to ask to give up his or her seat, how they are going to ask, and what to do if the passenger declines. The passenger makes the decision based on how urgent the flight is, how the airline proposes the question, and his or her value of the seat. The happiness of both the airline and the passenger are dependent not just on their own decisions, but on the decisions of the other parties as well.

http://www.npr.org/2017/04/13/523726313/how-game-theory-relates-to-airline-booking

Comments

Leave a Reply

Blogging Calendar

September 2017
M T W T F S S
« Aug   Oct »
 123
45678910
11121314151617
18192021222324
252627282930  

Archives