BK21 Plus Seminar 2017. 11. 02 (목), Guillermo Gallego (Hong Kong University)

BK21 Plus Seminar 2017. 11. 02 (목), Guillermo Gallego (Hong Kong University)

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  1. 주 제 : Approximating Algorithms for Product Framing and Pricing
  2. 연 사 : Prof. Guillermo Gallego (Hong Kong University)
  3. 내 용 : We propose one of the first models of “product framing” and pricing. Product framing refers to the way consumer choice is influenced by how the products are framed, or displayed. We present a model where a set of products are displayed, or framed, into a set of virtual web pages. We assume that consumers consider only products in the top pages, with different consumers willing to see different numbers of pages. Consumers select a product, if any, from these pages following a general choice model. We show that the product framing problem is NP-hard. We derive algorithms with guaranteed performance relative to an optimal algorithm under reasonable assumptions. Our algorithms are fast and easy to implement. We also present structural results for pricing under framing effects. For profit maximization problem, at optimality products are sorted in descending order of value gap, which is defined as expected utility when the product is priced at cost; and markups are page-dependent, with higher markups associated with products on later pages, so that products in the first page are of the highest utility and have the lowest markups. Joint work with: Anran Li, Van-anh Truong, and Xinshang Wang.
  4. 일 시 : 2017년 11월 2일 (목) 오후 4시30분
  5. 장 소 : 39동 325호
  6. 문 의 : 문일경교수 (ikmoon@snu.ac.kr)
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