On a Three-Level Competitive Pricing Problem with Uniform and Mill Pricing Strategies

On a Three-Level Competitive Pricing Problem with Uniform and Mill Pricing Strategies Full article

Journal

Journal of Applied and Industrial Mathematics
ISSN: 1990-4789 , E-ISSN: 1990-4797

Output data

Year: 2019, Volume: 13, Pages: 54-64 Pages count : 11 DOI: 10.1134/S1990478919010071

Tags

competitive pricing problem; coordinate descent; decomposition; exact and approximate algorithm; Stackelberg game; three-level problem; uniform and mill pricing; variable neighborhood descent

Authors

Gubareva A.V. ¹ , Panin A.A. ^1,2 , Plyasunov A.V. ^1,2 , Som L.V. ²

Affiliations

1	Novosibirsk State University, ul. Pirogova 2, Novosibirsk, 630090, Russian Federation
2	Sobolev Institute of Mathematics, pr. Akad. Koptyuga 4, Novosibirsk, 630090, Russian Federation

Under study is a three-level pricing problem formulated as a Stackelberg game in which the two companies, the Leader and the Follower, compete with each other for customers demand by setting prices for homogeneous products on their facilities. The first decision is made by the Leader. Then, having full information about the Leader’s choice, the Follower makes his own decision.After that each customer chooses the facilitywithminimal service costs to be serviced from. The Leader and the Follower use different pricing strategies: uniform and mill pricing respectively. We study the behavior of company revenues depending on the number of facilities. For this, an exact decomposition type algorithm is proposed. Moreover, we developed a hybrid approximation algorithm that is based on the variable neighborhood descent and coordinate descent. D

Gubareva A.V. , Panin A.A. , Plyasunov A.V. , Som L.V.
On a Three-Level Competitive Pricing Problem with Uniform and Mill Pricing Strategies
Journal of Applied and Industrial Mathematics. 2019. V.13. P.54-64. DOI: 10.1134/S1990478919010071 Scopus OpenAlex

Scopus:	2-s2.0-85064809185
OpenAlex:	W2941412227

DB	Citing
Scopus	1
OpenAlex	1