Abstract
There are few quantitative studies on decision making of air ticket price control problem. In this paper we establish a game decision making model of price control for government by introducing two new factors: consumer’s surplus (the public welfares) and the passenger load rate (LR). We get some interesting conclusions from modeling and discussion. The administering authority, CAAC (Civil Aviation Administration of China) is inclined to ignore the public welfares when setting a higher control price and the airlines are always inclined to disobey the control price of CAAC for achieving a higher passenger load rate and strengthening the competition edge. As a whole, the optimal strategy of CAAC is to set an inter-zone control price and the optimal strategy of airlines is to self determinate a price between the inter-zone prices. The reason of decision dissonance is that the cost evaluation of ticket pricing for the two players has tremendous difference.
This is a preview of subscription content, log in via an institution to check access.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Similar content being viewed by others
References
Han B (2000) A review on the price control of China’ s civil airplane ticket. Sci Technol Rev 1:52–54 (in Chinese)
Kang Z, Du W (2006) Control and re-control of civil aviation transport fare in our country. Northeast Financ Univ Trans 3(5):16–18 (in Chinese)
Li X, Deng J (2003) The reform of price management system of civil aviation based on price theory. China Civ Aviat Sch Trans 21(2):26–31 (in Chinese)
Liu J (2002) Game analysis and reform suggestion for air ticket price. China Price 11:26–29 (in Chinese)
Liu J (2006) The control and competition of natural monopoly industry. Search Truth 2:181–182 (in Chinese)
Mei H, Zhu J, Wang X (2006) Study of revenue management pricing based on game analysis. Forecasting 25(6):45–49 (in Chinese)
Min Z, Yang X (2003) Industry organization analysis on price evolvement of civil aviation enterprises. ShanXi Financ Univ Trans 3:57–61 (in Chinese)
Qiu Y (2001) A comparison analysis of deregulating price control between China and USA and the control policy choice of China. Special-zone Econ 4:35–36 (in Chinese)
Shaffer S (2001) Deregulation: theory and practice. J Econ Bus 53(6):107–109
Wang R (2004) Game explanation on price competition of airlines. Technoecon Manag Res 3:81–82 (in Chinese)
Yang S, Zhang X (2002) A game theoretical analysis of marketable air fare. Commer Res 12:10–13 (in Chinese)
Zhang L (2005) Control or deregulation of air transportation price. China Sci Technol Inf 12(21):113–123 (in Chinese)
Acknowledgments
We thank all the sponsors for their financial support. And especially, Chongyi Jing Author thanks his dear friend Dr Bin Zhou for his thoughtful comments, suggestions and helpful data resources, which greatly enhanced the accomplishment of this paper.
Author information
Authors and Affiliations
Corresponding author
Editor information
Editors and Affiliations
Rights and permissions
Copyright information
© 2013 Springer-Verlag Berlin Heidelberg
About this paper
Cite this paper
Jing, Cy. (2013). A Decision-Making Model of Price Control for Administering Authority. In: Qi, E., Shen, J., Dou, R. (eds) The 19th International Conference on Industrial Engineering and Engineering Management. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-642-38391-5_4
Download citation
DOI: https://doi.org/10.1007/978-3-642-38391-5_4
Published:
Publisher Name: Springer, Berlin, Heidelberg
Print ISBN: 978-3-642-38390-8
Online ISBN: 978-3-642-38391-5
eBook Packages: Business and EconomicsBusiness and Management (R0)