30,057 research outputs found
The effect of competition among brokers on the quality and price of differentiated internet services
Price war, as an important factor in undercutting competitors and attracting customers, has spurred considerable work that analyzes such conflict situation. However, in most of these studies, quality of service (QoS), as an important decision-making criterion, has been neglected. Furthermore, with the rise of service-oriented architectures, where players may offer different levels of QoS for different prices, more studies are needed to examine the interaction among players within the service hierarchy. In this paper, we present a new approach to modeling price competition in (virtualized) service-oriented architectures, where there are multiple service levels. In our model, brokers, as the intermediaries between end-users and service providers, offer different QoS by adapting the service that they obtain from lower-level providers so as to match the demands of their clients to the services of providers. To maximize profit, players, i.e. providers and brokers, at each level compete in a Bertrand game while they offer different QoS. To maintain an oligopoly market, we then describe underlying dynamics which lead to a Bertrand game with price constraints at the providers' level. Numerical simulations demonstrate the behavior of brokers and providers and the effect of price competition on their market shares.This work has been partly supported by National Science Foundation awards: CNS-0963974, CNS-1346688, CNS-1536090 and CNS-1647084
Should Optimal Designers Worry About Consideration?
Consideration set formation using non-compensatory screening rules is a vital
component of real purchasing decisions with decades of experimental validation.
Marketers have recently developed statistical methods that can estimate
quantitative choice models that include consideration set formation via
non-compensatory screening rules. But is capturing consideration within models
of choice important for design? This paper reports on a simulation study of a
vehicle portfolio design when households screen over vehicle body style built
to explore the importance of capturing consideration rules for optimal
designers. We generate synthetic market share data, fit a variety of discrete
choice models to the data, and then optimize design decisions using the
estimated models. Model predictive power, design "error", and profitability
relative to ideal profits are compared as the amount of market data available
increases. We find that even when estimated compensatory models provide
relatively good predictive accuracy, they can lead to sub-optimal design
decisions when the population uses consideration behavior; convergence of
compensatory models to non-compensatory behavior is likely to require
unrealistic amounts of data; and modeling heterogeneity in non-compensatory
screening is more valuable than heterogeneity in compensatory trade-offs. This
supports the claim that designers should carefully identify consideration
behaviors before optimizing product portfolios. We also find that higher model
predictive power does not necessarily imply better design decisions; that is,
different model forms can provide "descriptive" rather than "predictive"
information that is useful for design.Comment: 5 figures, 26 pages. In Press at ASME Journal of Mechanical Design
(as of 3/17/15
Geostatistical modeling in the presence of interaction between the measuring instruments, with an application to the estimation of spatial market potentials
This paper addresses the problem of recovering the spatial market potential
of a retail product from spatially distributed sales data. In order to tackle
the problem in a general way, the concept of spatial potential is introduced.
The potential is concurrently measured at different spatial locations and the
measurements are analyzed in order to recover the spatial potential. The
measuring instruments used to collect the data interact with each other, that
is, the measurement at a given spatial location is affected by the concurrent
measurements at other locations. An approach based on a novel geostatistical
model is developed. In particular, the model is able to handle both the
measuring instrument interaction and the missing data. A model estimation
procedure based on the expectation-maximization algorithm is provided as well
as standard inferential tools. The model is applied to the estimation of the
spatial market potential of a newspaper for the city of Bergamo, Italy. The
estimated spatial market potential is eventually analyzed in order to identify
the areas with the highest potential, to identify the areas where it is
profitable to open additional newsstands and to evaluate the newspaper total
market volume of the city.Comment: Published in at http://dx.doi.org/10.1214/12-AOAS588 the Annals of
Applied Statistics (http://www.imstat.org/aoas/) by the Institute of
Mathematical Statistics (http://www.imstat.org
Location models in the public sector
The past four decades have witnessed an explosive growth in the field of networkbased facility location modeling. This is not at all surprising since location policy is one of the most profitable areas of applied systems analysis in regional science and ample theoretical and applied challenges are offered. Location-allocation models seek the location of facilities and/or services (e.g., schools, hospitals, and warehouses) so as to optimize one or several objectives generally related to the efficiency of the system or to the allocation of resources. This paper concerns the location of facilities or services in discrete space or networks, that are related to the public sector, such as emergency services (ambulances, fire stations, and police units), school systems and postal facilities. The paper is structured as follows: first, we will focus on public facility location models that use some type of coverage criterion, with special emphasis in emergency services. The second section will examine models based on the P-Median problem and some of the issues faced by planners when implementing this formulation in real world locational decisions. Finally, the last section will examine new trends in public sector facility location modeling.Location analysis, public facilities, covering models
Look-ahead strategies for dynamic pickup and delivery problems
In this paper we consider a dynamic full truckload pickup and delivery problem with time-windows. Jobs arrive over time and are offered in a second-price auction. Individual vehicles bid on these jobs and maintain a schedule of the jobs they have won. We propose a pricing and scheduling strategy based on dynamic programming where not only the direct costs of a job insertion are taken into account, but also the impact on future opportunities. Simulation is used to evaluate the benefits of pricing opportunities compared to simple pricing strategies in various market settings. Numerical results show that the proposed approach provides high quality solutions, in terms of profits, capacity utilization, and delivery reliability
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