Economics of secondary queue of Indian railways passenger reservation system: a queueing science approach

Reservation systems permit a potential customer to book and pay for a service for the slot in advance. These potential customers are allowed to surrender their services due to unforeseen conditions. Overbooking is preferred in such a situation to save the system from idleness. Studies designated queue formations in overbooking as secondary queues. Such secondary queue performance measures with the data-driven approach for a single class of train of Indian Railways have been studied statistically for a better understanding of arrival and service rate to choose an appropriate queueing model. Further, an attempt has been made for what-if analysis by arbitrarily increasing and decreasing the system’s current state to better estimate the effect on revenue loss due to the overbooking threshold. The economic analyses in the light of queueing science with two economic facets (i) revenue lost due to inadequate waiting capacity resulting in reneging and balking and (ii) the burden of cost for having additional channels to reduce these phenomenon has been analysed. It is found that either railway has to increase the fare (estimated in the study) to bring in breakeven or change the design of the secondary queue of the existing system to reduce the loss.