Pop quiz: what does the formula ∏A = gUG + min(k-g, (1-g)(1-r)) mean to you? Well, if you’re a savvy traveler, you’ll already know that it represents the answer to the age old question of when is the optimum time to purchase a flight. No simple algebra for NewsFeed!
The economist Makoto Watanabe has worked out that we should be purchasing our tickets eight weeks ahead of flying. His work appears in the latest edition of the Economic Journal, where Watanabe and colleague Marc Möller, come up with the aforementioned equation, ∏A = gUG + min(k – g, (1 – g)(1 – r)), where, obviously, ∏ equals profit and how that should determine the advance ticket purchase.
What’s more, the findings suggest tickets are cheaper in the afternoons, causing Watanabe to surmise that airlines assume business travelers book from work in the morning on the company dime, whereas the rest of us are doing it at leisure, in between all our surfing (NewsFeed employees and readers notwithstanding).
The only note of caution must surely be that if everyone jumps on these findings, won’t the eight week answer eventually mean that the airlines ensure that prices are then intentionally kept high at this point? If so, expect frustrated travelers to replace ∏A = gUG + min(k – g, (1 – g)(1 – r)) with an exclamation along the lines of *!!&*()$)%*&^*()~!!