Application of quantum computing in choice-based network revenue management

Mogens Dalgaard, Antoine Boulanger, Alexander Papen, Rune T. Hansen, Thomas Fiig () and Janus Wesenberg
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Mogens Dalgaard: Kvantify
Antoine Boulanger: Amadeus IT Group
Alexander Papen: Amadeus IT Group
Rune T. Hansen: Kvantify
Thomas Fiig: Amadeus IT Group
Janus Wesenberg: Kvantify

Journal of Revenue and Pricing Management, 2025, vol. 24, issue 6, No 2, 506-523

Abstract: Abstract This paper explores the potential of quantum computing for solving the choice-based deterministic linear program (CDLP) for network revenue management. The CDLP is a model that incorporates customer choice between parallel itineraries serving the same origin–destination market and has been shown to offer significant revenue benefits compared to traditional methods. However, the CDLP is computationally intractable for realistic network sizes due to the exponential growth of the offer set space. We propose a novel quantum algorithm that uses quantum column generation and quantum search to achieve a quadratic speed-up over the classical counterparts. We demonstrate the feasibility and performance of our quantum algorithm on a toy network example and discuss the implications and challenges for future applications. Our work stands as the first of its kind to apply quantum computing to the domain of airline revenue management.

Keywords: Network revenue management; Linear programming; Customer choice behavior; Multinomial logit choice model; Quantum computing; Grover search (search for similar items in EconPapers)
Date: 2025
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DOI: 10.1057/s41272-025-00527-8

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