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Intertemporal Pricing with Unobserved Consumer Arrival Times

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Author Info

  • Philippe Choné

    ()
    (CREST)

  • Romain De Nijs

    ()
    (CREST & UC Berkeley)

  • Lionel Wilner

    ()
    (CREST-INSEE 104 rue de la Convention 75015 Paris Tél : 06 22 82 56 26)

Abstract

We examine optimal selling mechanisms with ex-ante commitment for a nondurable good when the seller does not observe the times at which strategic consumers arrive on the market and how much they are willing to pay for the good. Assuming consumer risk neutrality, we demonstrate in this two-dimensional screening problem that stochastic mechanisms are suboptimal. In practice, this means that quantity rationing and behavior-based price discrimination do not improve the profit compared to a simple time-dependent price schedule. We explain how the optimal profit may be achieved with a first-come first-served policy

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Bibliographic Info

Paper provided by Centre de Recherche en Economie et Statistique in its series Working Papers with number 2012-23.

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Length: 22
Date of creation: Oct 2012
Date of revision:
Handle: RePEc:crs:wpaper:2012-23

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Keywords: Intertemporal pricing; Strategic consumers; Arrival dates; Heterogeneous cohorts; two-dimensional screening;

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References

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  1. Andrzej Skrzypacz & Simon Board, 2011. "Revenue Management with Forward-Looking Buyers," 2011 Meeting Papers 87, Society for Economic Dynamics.
  2. Dana, James D, Jr, 2001. "Monopoly Price Dispersion under Demand Uncertainty," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 42(3), pages 649-70, August.
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  14. Simon Board, 2008. "Durable-Goods Monopoly with Varying Demand," Review of Economic Studies, Oxford University Press, vol. 75(2), pages 391-413.
  15. Gale, Ian L & Holmes, Thomas J, 1993. "Advance-Purchase Discounts and Monopoly Allocation of Capacity," American Economic Review, American Economic Association, vol. 83(1), pages 135-46, March.
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Cited by:
  1. X. DHaultfoeuille & P. Fevrier & L. Wilner, 2012. "Demand Estimation in the Presence of Revenue Management," Documents de Travail de la DESE - Working Papers of the DESE g2012-13, Institut National de la Statistique et des Etudes Economiques, DESE.

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