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Zhan Pang - One of the best experts on this subject based on the ideXlab platform.

  • up then down Bid Price trends in revenue management
    Production and Operations Management, 2015
    Co-Authors: Zhan Pang, Oded Berman
    Abstract:

    In the classic revenue management (RM) problem of selling a fixed quantity of perishable inventories to Price-sensitive non-strategic consumers over a finite horizon, the optimal pricing decision at any time depends on two important factors: consumer valuation and Bid Price. The former is determined exogenously by the demand side, while the latter is determined jointly by the inventory level on the supply side and the consumer valuations in the time remaining within the selling horizon. Because of the importance of Bid Prices in theory and practice of RM, this study aims to enhance the understanding of the intertemporal behavior of Bid Prices in dynamic RM environments. We provide a probabilistic characterization of the optimal policies from the perspective of Bid-Price processes. We show that an optimal Bid-Price process has an upward trend over time before the inventory level falls to one and then has a downward trend. This intertemporal up-then-down pattern of Bid-Price processes is related to two fundamental static properties of the optimal Bid Prices: (i) At any given time, a lower inventory level yields a higher optimal Bid Price, which is referred to as the resource scarcity effect; (ii) Given any inventory level, the optimal Bid Price decreases with time; that is referred to as the resource perishability effect. The demonstrated upward trend implies that the optimal Bid-Price process is mainly driven by the resource scarcity effect, while the downward trend implies that the Bid-Price process is mainly driven by the resource perishability effect. We also demonstrate how optimal Bid Price and consumer valuation, as two competing forces, interact over time to drive the optimal-Price process. The results are also extended to the network RM problems.

  • Up Then Down: Bid‐Price Trends in Revenue Management
    Production and Operations Management, 2015
    Co-Authors: Zhan Pang, Oded Berman, Ming Hu
    Abstract:

    In the classic revenue management (RM) problem of selling a fixed quantity of perishable inventories to Price-sensitive non-strategic consumers over a finite horizon, the optimal pricing decision at any time depends on two important factors: consumer valuation and Bid Price. The former is determined exogenously by the demand side, while the latter is determined jointly by the inventory level on the supply side and the consumer valuations in the time remaining within the selling horizon. Because of the importance of Bid Prices in theory and practice of RM, this paper aims to enhance the understanding of the intertemporal behavior of Bid Prices in dynamic RM environments. We provide a probabilistic characterization of the optimal policies from the perspective of Bid-Price processes. We show that an optimal Bid-Price process has an upward trend over time before the inventory level falls to one and then has a downward trend. This intertemporal up-then-down pattern of Bid-Price processes is related to two fundamental static properties of the optimal Bid Prices: (1) At any given time, a lower inventory level yields a higher optimal Bid Price, which is referred to as the resource scarcity effect; (2) Given any inventory level, the optimal Bid Price decreases with time; that is referred to as the resource perishability effect. The demonstrated upward trend implies that the optimal Bid-Price process is mainly driven by the resource scarcity effect while the downward trend implies that the Bid-Price process is mainly driven by the resource perishability effect. We also demonstrate how optimal Bid Price and consumer valuation, as two competing forces, interact over time to drive the optimal-Price process. The results are also extended to the network RM problems.

  • Up then Down: The Bid-Price Trends in Revenue Management
    SSRN Electronic Journal, 2013
    Co-Authors: Zhan Pang, Oded Berman
    Abstract:

    In the classic revenue management (RM) problem of selling a fixed quantity of perishable inventories to Price-sensitive non-strategic consumers over a finite horizon, the optimal pricing decision at any time depends on two important factors: consumer valuation and Bid Price. The former is determined exogenously by the demand side, while the latter is determined jointly by the inventory level on the supply side and the consumer valuations in the time remaining within the selling horizon. Because of the importance of Bid Prices in theory and practice of RM, this paper aims to enhance the understanding of the intertemporal behavior of Bid Prices in dynamic RM environments. We provide a probabilistic characterization of the optimal policies from the perspective of Bid-Price processes. We show that an optimal Bid-Price process has an upward trend over time before the inventory level falls to one and then has a downward trend. This intertemporal up-then-down pattern of Bid-Price processes is related to two fundamental static properties of the optimal Bid Prices: (1) At any given time, a lower inventory level yields a higher optimal Bid Price, which is referred to as the resource scarcity effect; (2) Given any inventory level, the optimal Bid Price decreases with time; that is referred to as the resource perishability effect. The demonstrated upward trend implies that the optimal Bid-Price process is mainly driven by the resource scarcity effect while the downward trend implies that the Bid-Price process is mainly driven by the resource perishability effect. We also demonstrate how optimal Bid Price and consumer valuation, as two competing forces, interact over time to drive the optimal-Price process. The results are also extended to the network RM problems.

Oded Berman - One of the best experts on this subject based on the ideXlab platform.

  • up then down Bid Price trends in revenue management
    Production and Operations Management, 2015
    Co-Authors: Zhan Pang, Oded Berman
    Abstract:

    In the classic revenue management (RM) problem of selling a fixed quantity of perishable inventories to Price-sensitive non-strategic consumers over a finite horizon, the optimal pricing decision at any time depends on two important factors: consumer valuation and Bid Price. The former is determined exogenously by the demand side, while the latter is determined jointly by the inventory level on the supply side and the consumer valuations in the time remaining within the selling horizon. Because of the importance of Bid Prices in theory and practice of RM, this study aims to enhance the understanding of the intertemporal behavior of Bid Prices in dynamic RM environments. We provide a probabilistic characterization of the optimal policies from the perspective of Bid-Price processes. We show that an optimal Bid-Price process has an upward trend over time before the inventory level falls to one and then has a downward trend. This intertemporal up-then-down pattern of Bid-Price processes is related to two fundamental static properties of the optimal Bid Prices: (i) At any given time, a lower inventory level yields a higher optimal Bid Price, which is referred to as the resource scarcity effect; (ii) Given any inventory level, the optimal Bid Price decreases with time; that is referred to as the resource perishability effect. The demonstrated upward trend implies that the optimal Bid-Price process is mainly driven by the resource scarcity effect, while the downward trend implies that the Bid-Price process is mainly driven by the resource perishability effect. We also demonstrate how optimal Bid Price and consumer valuation, as two competing forces, interact over time to drive the optimal-Price process. The results are also extended to the network RM problems.

  • Up Then Down: Bid‐Price Trends in Revenue Management
    Production and Operations Management, 2015
    Co-Authors: Zhan Pang, Oded Berman, Ming Hu
    Abstract:

    In the classic revenue management (RM) problem of selling a fixed quantity of perishable inventories to Price-sensitive non-strategic consumers over a finite horizon, the optimal pricing decision at any time depends on two important factors: consumer valuation and Bid Price. The former is determined exogenously by the demand side, while the latter is determined jointly by the inventory level on the supply side and the consumer valuations in the time remaining within the selling horizon. Because of the importance of Bid Prices in theory and practice of RM, this paper aims to enhance the understanding of the intertemporal behavior of Bid Prices in dynamic RM environments. We provide a probabilistic characterization of the optimal policies from the perspective of Bid-Price processes. We show that an optimal Bid-Price process has an upward trend over time before the inventory level falls to one and then has a downward trend. This intertemporal up-then-down pattern of Bid-Price processes is related to two fundamental static properties of the optimal Bid Prices: (1) At any given time, a lower inventory level yields a higher optimal Bid Price, which is referred to as the resource scarcity effect; (2) Given any inventory level, the optimal Bid Price decreases with time; that is referred to as the resource perishability effect. The demonstrated upward trend implies that the optimal Bid-Price process is mainly driven by the resource scarcity effect while the downward trend implies that the Bid-Price process is mainly driven by the resource perishability effect. We also demonstrate how optimal Bid Price and consumer valuation, as two competing forces, interact over time to drive the optimal-Price process. The results are also extended to the network RM problems.

  • Up then Down: The Bid-Price Trends in Revenue Management
    SSRN Electronic Journal, 2013
    Co-Authors: Zhan Pang, Oded Berman
    Abstract:

    In the classic revenue management (RM) problem of selling a fixed quantity of perishable inventories to Price-sensitive non-strategic consumers over a finite horizon, the optimal pricing decision at any time depends on two important factors: consumer valuation and Bid Price. The former is determined exogenously by the demand side, while the latter is determined jointly by the inventory level on the supply side and the consumer valuations in the time remaining within the selling horizon. Because of the importance of Bid Prices in theory and practice of RM, this paper aims to enhance the understanding of the intertemporal behavior of Bid Prices in dynamic RM environments. We provide a probabilistic characterization of the optimal policies from the perspective of Bid-Price processes. We show that an optimal Bid-Price process has an upward trend over time before the inventory level falls to one and then has a downward trend. This intertemporal up-then-down pattern of Bid-Price processes is related to two fundamental static properties of the optimal Bid Prices: (1) At any given time, a lower inventory level yields a higher optimal Bid Price, which is referred to as the resource scarcity effect; (2) Given any inventory level, the optimal Bid Price decreases with time; that is referred to as the resource perishability effect. The demonstrated upward trend implies that the optimal Bid-Price process is mainly driven by the resource scarcity effect while the downward trend implies that the Bid-Price process is mainly driven by the resource perishability effect. We also demonstrate how optimal Bid Price and consumer valuation, as two competing forces, interact over time to drive the optimal-Price process. The results are also extended to the network RM problems.

Gultekin Kuyzu - One of the best experts on this subject based on the ideXlab platform.

Martin W P Savelsbergh - One of the best experts on this subject based on the ideXlab platform.

  • Bid Price optimization for truckload carriers in simultaneous transportation procurement auctions
    Transportation Research Part B-methodological, 2015
    Co-Authors: Gultekin Kuyzu, Cagla Gul Akyol, Ozlem Ergun, Martin W P Savelsbergh
    Abstract:

    We study simultaneous transportation procurement auctions from a truckload carrier’s perspective. We formulate a stochastic Bid Price optimization model aimed at maximizing the carrier’s expected profit. The model accounts for synergies among lanes and competing carriers’ Bid patterns. We develop an iterative coordinate search algorithm to find high-quality solutions. The benefits of employing the Bid Price optimization technology are demonstrated through computational experiments involving a simulated marketplace.

Tian Xia - One of the best experts on this subject based on the ideXlab platform.

  • a note on first Price sealed Bid cattle auctions in the presence of captive supplies
    2015
    Co-Authors: John M Crespi, Tian Xia
    Abstract:

    The authors present an analytical model of a I irst-Price sealed-Bid cattle auction in which a spot and coordinated markets are interconnected. The model reveals that the conventional wisdom that market coordination negatively affects the Bid Price in the spot market is an oversimpliI ication. The relationships between key market variables impact Bids and Bid shading in complex ways. While captive supplies can lead to lower spot Prices, the Price reductions do not necessarily stem from an increase in market power due to contracting. The model emphasizes the importance of several variables for future empirical studies.

  • a note on first Price sealed Bid cattle auctions in the presence of captive supplies
    ISU General Staff Papers, 2015
    Co-Authors: John M Crespi, Tian Xia
    Abstract:

    The authors present an analytical model of a first-Price sealed-Bid cattle auction in which a spot and coordinated markets are interconnected. The model reveals that the conventional wisdom that market coordination negatively affects the Bid Price in the spot market is an oversimplification. The relationships between key market variables impact Bids and Bid shading in complex ways. While captive supplies can lead to lower spot Prices, the Price reductions do not necessarily stem from an increase in market power due to contracting. The model emphasizes the importance of several variables for future empirical studies. (This abstract was borrowed from another version of this item.) (This abstract was borrowed from another version of this item.)