期刊
MANAGEMENT SCIENCE
卷 63, 期 11, 页码 3586-3608出版社
INFORMS
DOI: 10.1287/mnsc.2016.2526
关键词
social learning; information aggregation; bounded rationality; optimal pricing
资金
- NET Institute
- Progetti di Ricerca di Interesse Nazionale [20103S5RN3]
- Singapore University of Technology and Design-Massachusetts Institute of Technology (SUTD-MIT) International Design Centre [IDG31300110]
Amonopolist offers a product to a market of consumers with heterogeneous quality preferences. Although initially uninformed about the product quality, they learn by observing past purchase decisions and reviews of other consumers. Our goal is to analyze the social learning mechanism and its effect on the seller's pricing decision. Consumers follow an intuitive, non-Bayesian decision rule. Under conditions that we identify, we show that consumers eventually learn the product's quality. We show how the learning trajectory can be approximated in settings with high demand intensity via a mean-field approximation that highlights the dynamics of this learning process, its dependence on the price, and the market heterogeneity with respect to quality preferences. Two pricing policies are studied: a static price and one with a single price change. Finally, numerical experiments suggest that pricing policies that account for social learning may increase revenues considerably relative to policies that do not.
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