Risk-Averse Capacity Control in Revenue Management

“If necessity is the mother of invention, then deregulation is the father, and r- enue management (also known as yield management) is the couple’s golden child – at least as far as operations research is concerned.” (Horner, 2000, p. 47) Deregulation had

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Founding Editors: M. Beckmann H.P. Künzi Managing Editors: Prof. Dr. G. Fandel Fachbereich Wirtschaftswissenschaften Fernuniversität Hagen Feithstr. 140/AVZ II, 58084 Hagen, Germany Prof. Dr. W. Trockel Institut für Mathematische Wirtschaftsforschung (IMW) Universität Bielefeld Universitätsstr. 25, 33615 Bielefeld, Germany Editorial Board: A. Basile, A. Drexl, H. Dawid, K. Inderfurth, W. Kürsten, U. Schittko

Christiane Barz

Risk-Averse Capacity Control in Revenue Management

With 32 Figures and 10 Tables

123

Christiane Barz Universität Karlsruhe (TH) Fakultät für Wirtschaftswissenschaften Kaiserstraße 12 76128 Karlsruhe Germany [email protected]

Dissertation, genehmigt von der Fakultät für Wirtschaftswissenschaften der Universität Fridericiana zu Karlsruhe, gefördert durch die DFG. Referent: Prof. Dr. Karl-Heinz Waldmann; Korreferentin: Prof. Dr. Marliese Uhrig-Homburg; Tag der mündlichen Prüfung: 19.12.2006.

Library of Congress Control Number: 2007930764

ISSN 0075-8442 ISBN 978-3-540-73013-2 Springer Berlin Heidelberg New York This work is subject to copyright. All rights are reserved, whether the whole or part of the material is concerned, specifically the rights of translation, reprinting, reuse of illustrations, recitation, broadcasting, reproduction on microfilm or in any other way, and storage in data banks. Duplication of this publication or parts thereof is permitted only under the provisions of the German Copyright Law of September 9, 1965, in its current version, and permission for use must always be obtained from Springer. Violations are liable to prosecution under the German Copyright Law. Springer is a part of Springer Science+Business Media springer.com © Springer-Verlag Berlin Heidelberg 2007 The use of general descriptive names, registered names, trademarks, etc. in this publication does not imply, even in the absence of a specific statement, that such names are exempt from the relevant protective laws and regulations and therefore free for general use. Production: LE-TEX Jelonek, Schmidt & V¨ ockler GbR, Leipzig Cover-design: WMX Design GmbH, Heidelberg SPIN 12075102

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Acknowledgements “A fool . . . is a man who never tried an experiment in his life.” (Erasmus Darwin)

I would like to thank all of those who supported me during my biggest experiment so far, the completion of this thesis. In particular, I would like to thank my supervisor, Prof. Dr. Karl-Heinz Waldmann. Without his help, this work would not have been possible. I also thank my co-advisor, Prof. Dr. Marliese Uhrig-Homburg, for her valuable and constructive comments on my work and beyond. I am deeply indebted to Dr. Alfred M¨ uller. His stimulating suggestions and unflinching encouragement were invaluable. I thank him and all the other colleagues at the chair for their support. This work was funded by the DFG Graduate School for Information Management and Market Engineering. Many thanks go to all members of this program. Words fail me to express my appreciation t