Non-linear pricing by convex duality

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dc.citation.epage375en_US
dc.citation.spage369en_US
dc.citation.volumeNumber53en_US
dc.contributor.authorPınar, M. Ç.en_US
dc.date.accessioned2016-02-08T10:13:46Z
dc.date.available2016-02-08T10:13:46Z
dc.date.issued2015en_US
dc.departmentDepartment of Industrial Engineeringen_US
dc.description.abstractWe consider the pricing problem of a risk-neutral monopolist who produces (at a cost) and offers an infinitely divisible good to a single potential buyer that can be of a finite number of (single dimensional) types. The buyer has a non-linear utility function that is differentiable, strictly concave and strictly increasing. Using a simple reformulation and shortest path problem duality as in Vohra (2011) we transform the initial non-convex pricing problem of the monopolist into an equivalent optimization problem yielding a closed-form pricing formula under a regularity assumption on the probability distribution of buyer types. We examine the solution of the problem when the regularity condition is relaxed in different ways, or when the production function is non-linear and convex. For arbitrary type distributions, we offer a complete solution procedure.en_US
dc.identifier.doi10.1016/j.automatica.2015.01.027en_US
dc.identifier.eissn1873-2836
dc.identifier.issn0005-1098
dc.identifier.urihttp://hdl.handle.net/11693/23425
dc.language.isoEnglishen_US
dc.publisherElsevieren_US
dc.relation.isversionofhttp://dx.doi.org/10.1016/j.automatica.2015.01.027en_US
dc.source.titleAutomaticaen_US
dc.subjectAsymmetric informationen_US
dc.subjectConvex optimizationen_US
dc.subjectMechanism designen_US
dc.subjectNonlinear pricingen_US
dc.subjectShortest pathsen_US
dc.subjectConvex optimizationen_US
dc.subjectEconomicsen_US
dc.subjectGraph theoryen_US
dc.subjectMachine designen_US
dc.subjectOptimizationen_US
dc.subjectProbability distributionsen_US
dc.subjectSalesen_US
dc.subjectAsymmetric informationen_US
dc.subjectMechanism designen_US
dc.subjectNon-linear pricingen_US
dc.subjectNonlinear utility functionsen_US
dc.subjectOptimization problemsen_US
dc.subjectRegularity assumptionen_US
dc.subjectShortest pathen_US
dc.subjectShortest path problemen_US
dc.subjectCostsen_US
dc.titleNon-linear pricing by convex dualityen_US
dc.typeArticleen_US

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