I read an interesting article about the history of airline overbooking from the University of Illinois News Bureau. Julian Simon, a former faculty member in Economics, pioneered the idea back in the 1960’s. Simon “devised the notion of rewarding passengers on overbooked flights if they gave up their seats. The seemingly subtle switch provided a $100 billion jolt to the U.S. economy over the last three decades, says former colleague James Heins.” What the article doesn’t say is that although an economist came up with the idea from which he never profited, operations researchers ran with the idea, accounting for much of the $100B in savings. If you google anything about airline overbooking, numerous operations research papers come up (such as the classic 1985 Marvin Rothstein paper). I am more interested in a more recent history that highlights how operations research has contributed to airline overbooking. Post a link in the comments if you know of any good overview articles. The Travel Insider has a good lay overview of how overbooking works, but it doesn’t mention OR, of course. Link.
September 8, 2009
By Laura Albert
This entry was posted on Tuesday, September 8th, 2009 at 12:04 pm and tagged with aviation and posted in Uncategorized. You can follow any responses to this entry through the RSS 2.0 feed.
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