Dynamic Pricing for Railway Tickets with Demand-Shifted Passenger Groups

Based on the division of passenger groups and those groups' certain probabilities of buying tickets, we researched the dynamic pricing model of railway tickets when loyal passenger groups may shift to book seats of ordinary passenger group. Firstly, according to the optimization theory, the author analyzed the condition that the optimal dynamic ticket price should be met when all of loyal groups' demands have been met within its booking limits. Secondly, based on the former condition and through the way of Decision Tree Analysis (DTA), we studied the condition that prices' further optimization should be met when loyal group's demands outside its booking limits and turn to ordinary group for some seats. Lastly, under different proportion of ordinary group, we compared the results of ticket price and expected revenue's, analyzed this model's effectiveness and proposed the further problems.(1)