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Evaluating optimal multi-hub networks in a deregulated aviation market with an application to Western Europe
Institution:1. Department of Industrial Engineering and Management, Ben Gurion University of the Negev, P.O. Box 653, Beer Sheva 84105, Israel;2. Department of Public Policy, Tel Aviv University, Ramat Aviv, Israel;1. Sauder School of Business, University of British Columbia, 2053 Main Mall, Vancouver, BC V6T 1Z2, Canada;2. School of Commerce, University of Southern Queensland, Toowoomba, Queensland, Australia;3. China Academy of Financial Research, Shanghai Jiao Tong University, China;1. Newcastle University Business School, 5 Barrack Road, Newcastle upon Tyne NE1 4SE, United Kingdom;2. University of Applied Sciences, Faculty of Business and Economics, Blechhammer 9, D-98574 Schmalkalden, Germany;3. ZEW Centre for European Economic Research, P.O. Box 10 34 43, D-68034 Mannheim, Germany;1. Universitat Politècnica de Catalunya – BarcelonaTech, C/Colom no. 11, Terrassa 08222, Spain;2. Volotea, Travessera de Gràcia, 56, Barcelona 08006, Spain;1. Head Aviation Cluster, SEO Economic Research, Roetersstraat 29, 1018 WB Amsterdam, The Netherlands;2. Institute for Information Law, University of Amsterdam, The Netherlands;3. Schiphol Group, The Netherlands
Abstract:This paper develops, evaluates and ultimately aids in the choosing of an optimal, single allocation, hub-and-spoke network for an airline working in a deregulated market. An integer linear program evaluates potential hub network combinations, whose profits are then determined using a non-linear mathematical program. International gateway airports and regional hubs, profit, frequency and aircraft size are the decision variables. An adapted, conjugate-gradient projection algorithm is developed and the models are subsequently applied to Western Europe.
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