Dynamic pricing of duopoly through pricing game based on price discrimination

Research output: Chapter in Book/Report/Conference proceedingConference contributionpeer-review

1 Scopus citations

Abstract

We discuss in this paper whether two members in duopoly market will make benefit from dynamic pricing based on price discrimination. In addition, we want to know which one in duopoly market will make more profits through dynamic pricing in a pricing game. We set the case to a pricing game in Hotelling model where two firms will perform a fierce price war to grab the market share of switchers under the prerequisite of ensuring the profit of the loyal through dynamic pricing based on price discrimination. We conclude that firms which implement dynamic pricing based on price discrimination will be better off than those not. In addition, we can reach a crucial conclusion that the firm which embraces a strong power of monopoly advantage and charges a higher price in the duopoly market is sure to make more profits through dynamic pricing based on price discrimination, while the other firm will make less profit in the pricing game undoubtedly.

Original languageEnglish
Title of host publicationProceedings - 2014 7th International Joint Conference on Computational Sciences and Optimization, CSO 2014
EditorsLean Yu, Qing Zhu, Jian Chai, Jian Chai, Shouyang Wang
PublisherInstitute of Electrical and Electronics Engineers Inc.
Pages621-625
Number of pages5
ISBN (Electronic)9781479953721
DOIs
StatePublished - 14 Oct 2014
Externally publishedYes
Event7th International Joint Conference on Computational Sciences and Optimization, CSO 2014 - Beijing, China
Duration: 4 Jul 20146 Jul 2014

Publication series

NameProceedings - 2014 7th International Joint Conference on Computational Sciences and Optimization, CSO 2014

Conference

Conference7th International Joint Conference on Computational Sciences and Optimization, CSO 2014
Country/TerritoryChina
CityBeijing
Period4/07/146/07/14

Keywords

  • Hotelling model
  • duopoly
  • dynamic pricing
  • price discrimination

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