Agent-based analysis and simulation of the consumer airline market share for Frontier Airlines

The complex and interconnected world in which organizations operate presents many challenges to the traditional neo-classical view of research and management and associated research techniques. Fundamental to the operation of financial capital markets, investor confidence relies on accurate investment analyst earnings forecasts. We propose agent-based modeling (ABM) as a viable tool to account for the interaction of local and environmental factors to determine organizational success. In an illustrative case study of Frontier Airlines, we develop and execute an ABM of Frontier’s consumer airline market to derive market share for the upcoming year. In the model, Frontier is impacted by internal policies, competitors, and environmental factors of fuel costs, federal regulation, and credit availability. We conclude with a discussion on how ABM can be effectively incorporated into future research activities and decision-making situations.