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Multistage modeling of advanced seat reservation and fare product choices

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  • Wen, Chieh-Hua
  • Tai, Zheng

Abstract

Airlines provide a range of fare products and ancillary services to accommodate travelers’ diverse requirements. This study presents a modeling framework for air travel decisions, focusing on fare product choice and advanced seat selection. The framework is utilized to develop and estimate mixed logit models in multiple stages to enhance air travel demand and revenue forecasting. The proposed models are validated using online survey data collected from a sample of respondents who have traveled from Taipei to Tokyo and/or Taipei to San Francisco. The empirical results indicate that individual socioeconomic status and trip characteristics strongly influence decisions at various stages. Airfare and seat selection fees play crucial roles in air travelers’ decision-making. Significant substitutions between alternatives and notable heterogeneity in preferences were observed. Our findings offer important behavioral and managerial suggestions for airlines.

Suggested Citation

  • Wen, Chieh-Hua & Tai, Zheng, 2025. "Multistage modeling of advanced seat reservation and fare product choices," Research in Transportation Economics, Elsevier, vol. 114(C).
    • Handle: RePEc:eee:retrec:v:114:y:2025:i:c:s0739885925001350
    DOI: 10.1016/j.retrec.2025.101652
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    JEL classification:

    • C25 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions; Probabilities
    • L93 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Air Transportation
    • R41 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Transportation: Demand, Supply, and Congestion; Travel Time; Safety and Accidents; Transportation Noise

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