Game theory and an application

Nowadays the factors such as recovery in trade conditions, public incentives, expansion of markets due to globalisation struggling to respond the demand that increases day by day with the raising amount of population have ascended the number of companies and the competition among them. On the high level of competition circumstances, it is vital for companies to determine their aims and strategies by applying scientific analyses in order to maintain their existence. Thus in the study, it is aimed to designate the ideal strategies for two aviation companies with game theory, one of the decision analyses and is used often so as to increase their revenue. In the study, game theory and aviation are explained and in order to determine the optimum pricing policy two players zero sum game matris is formed by means of the daily data of ticket prices and amount of passengers that two airline companies had for Antalya (AYT) – Atatürk (IST) flights in 2015. The equilibrium point of the game matrix is calculated by the minmax - maxmin method and according to the results it is found out that two companies decrease the level of ticket prices due to intensive competition. It is determined that companies may raise the level of ticket prices by cooperating together so as to increase the income. Keywords: Game, Game Theory, Aviation, Nash Equilibrium, Static Games, Dynamic Games