Auction Theory and Its Potential Use in the Army Aviation Bonus System

摘要

The United States Army is increasing its force by 65,000 troops over the next few years. Included in this increase are Army aviators. Retention of the current soldiers in uniform is becoming very difficult as the deployment schedule of the current Global War on Terrorism wears down the individual aviator. Army Aviation is included in this build up of forces yet it must also compete with the amount of jobs becoming available as the baby boomer generation retires and leaves gaps in both the civilian pilot workforce for commercial airlines and also the United States Customs air inventory. This thesis will explore the Aviation Incentive program from its outset. It will then continue with a discussion of Auctions and Auction Theory. It will conclude with a game theory approach and other mathematical approaches on bidding in auctions. Combining Auction Theory with the mathematical approach provides the bidder in an auction a more educated decision in their bidding strategy. Utilizing Auctions for Aviator retention allows the Army to be more flexible in determining a value for a bonus rather than limited by the offer of a static amount which may or may not help with retention.