Topic
Dynamic pricing
About: Dynamic pricing is a research topic. Over the lifetime, 4144 publications have been published within this topic receiving 91390 citations. The topic is also known as: surge pricing & demand pricing.
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TL;DR: This paper developed a theory of dynamic pricing in which firms may offer separate prices to different consumers based on their past purchases, and provided a unified treatment of the two pricing policies and shed light on observed practices across industries.
Abstract: This article develops a theory of dynamic pricing in which firms may offer separate prices to different consumers based on their past purchases. Brand preferences over two periods are described by a copula admitting various degrees of positive dependence. When commitment to future prices is infeasible, each firm offers lower prices to its rival's customers. When firms can commit to future prices, consumer loyalty is rewarded if preference dependence is low, but enticing brand switching occurs if preference dependence is high. Our theory provides a unified treatment of the two pricing policies and sheds light on observed practices across industries.
80 citations
TL;DR: It is shown that by offering a menu of advance-purchase contracts that differ in when, and for how much, the product can be returned, a firm can more easily price discriminate between privately-informed consumers.
80 citations
TL;DR: In a dynamic competitive environment, switching costs have two effects: they increase the market power of a seller with locked-in customers, and they increase competition for new customers.
80 citations
TL;DR: In this paper, a robust demand response control of commercial buildings for smart grid under load prediction uncertainty is proposed. But the authors do not consider the impacts of load prediction uncertainties on the performance of the control.
80 citations
TL;DR: In this paper, the authors study pricing mechanisms that induce the optimal arrival rates when the system manager has no full knowledge of the demand in advance, and characterize the equilibrium and its stability conditions.
Abstract: Consider a data communication network owned and operated by a single organization. The network has an infinite number of small users and is managed by a system manager SM whose objective is to maximize the net value of the system as a whole. The objective of this paper is to study pricing mechanisms that induce the optimal arrival rates when the SM has no full knowledge of the demand in advance. We investigate the system behavior under three alternative dynamic pricing rules and users' expectations models, and characterize the equilibrium and its stability conditions.
80 citations