Strategic arrivals to queues offering priority service
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Publication:2281371
Abstract: We consider strategic arrivals to a FCFS service system that starts service at a fixed time and has to serve a fixed number of customers, e.g., an airplane boarding system. Arriving early induces a higher waiting cost (waiting before service begins) while arriving late induces a cost because earlier arrivals take the better seats. We first consider arrivals of heterogeneous customers that choose arrival times to minimize the weighted sum of waiting cost and and cost due to expected number of predecessors. We characterize the unique Nash equilibria for this system. Next, we consider a system offering L levels of priority service with a FCFS queue for each priority level. Higher priorities are charged higher admission prices. Customers make two choices - time of arrival and priority of service. We show that the Nash equilibrium corresponds to the customer types being divided into L intervals and customers belonging to each interval choosing the same priority level. We further analyze the net revenue to the server and consider revenue maximizing strategies - number of priority levels and pricing. Numerical results show that with only three queues the server can attain near maximum revenue.
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Cited in
(19)- Equilibrium customers' choice between FCFS and random servers
- Revenue maximization in service systems with heterogeneous customers
- Preemptible queues with advance reservations: strategic behavior and revenue management
- Strategic arrivals to a queue with service rate uncertainty
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- Charging more for priority via two-part Tariff for accumulating priorities
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- scientific article; zbMATH DE number 125775 (Why is no real title available?)
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