Application of Game Theoretic Models to Evaluate Airline Equipage Dynamics of NextGen Technologies

The success of the Next Generation Air Transportation System (NextGen), relies strongly on the adoption of new technologies and operational procedures by airlines and operators. The adoption of technologies by one airline may depend on the decisions of other airlines as well as their perception of future benefits, uncertainty over other operators’ equipage decisions, uncertainty over the NextGen implementation timeline, asymmetry of benefits across stakeholders, and the availability of capital. Policies that affect these factors could be used to incentivize certain airline behaviors and redistribute the benefits of equipage. In order to motivate and justify such large NextGen technology implementation programs and sub-capabilities, system-level analyses of the NAS are heavily relied upon. However, there are shortcomings to current modeling techniques: (1) analyses are often treated deterministically and (2) strategic interactions between players that influence system level equipage are neglected, if not ignored. This paper presents the ongoing development of Air Carrier Behavioral Modeling techniques and their application to a test case, i.e., the implementation and equipage dynamics of Automatic Dependent Surveillance-Broadcast (ADS-B) in the high altitude Gulf of Mexico (GoMex) airspace. Game theoretic modeling and evaluation is discussed for ADS-B equipage behaviors of two airlines in the GoMex, under a best-equipped, best-served policy scenario. Using a Level-K solution concept, airline equipage rates are found to be sensitive to the airline’s own strategic level and operating costs, as well as its prediction of other airlines’ strategic level.