Strategic Heterogeneous Customers in a Transportation Station: Information and Pricing

dc.authoridCanbolat, Pelin Gulsah/0000-0003-0028-3285
dc.authoridManou, Athanasia/0000-0003-0934-5083
dc.authoridKaraesmen, Fikri/0000-0003-3851-6232
dc.authorscopusid54400446000
dc.authorscopusid54949950000
dc.authorscopusid6602761461
dc.authorwosidCanbolat, Pelin Gulsah/M-4935-2016
dc.contributor.authorCanbolat, Pelin Gülşah
dc.contributor.authorCanbolat, Pelin G.
dc.contributor.authorKaraesmen, Fikri
dc.date.accessioned2024-06-23T21:38:26Z
dc.date.available2024-06-23T21:38:26Z
dc.date.issued2024
dc.departmentKadir Has Universityen_US
dc.department-temp[Manou, Athanasia] Natl & Kapodistrian Univ Athens, Dept Math, Athens 15784, Greece; [Canbolat, Pelin G.] Kadir Has Univ, Dept Ind Engn, TR-34083 Istanbul, Turkiye; [Karaesmen, Fikri] Koc Univ, Dept Ind Engn, TR-34450 Istanbul, Turkiyeen_US
dc.descriptionCanbolat, Pelin Gulsah/0000-0003-0028-3285; Manou, Athanasia/0000-0003-0934-5083; Karaesmen, Fikri/0000-0003-3851-6232en_US
dc.description.abstractProblem definition: We consider pricing of services with strategic customers who have heterogeneous delay costs motivated by transportation systems. Customers are strategic decision makers who weigh the reward from the transport service against the waiting cost for the vehicle at a transportation station. Customers arrive at the station according to a Poisson process, and the vehicle visits the station according to a renewal process. We analyze the optimal price and the equilibrium for different levels of information available to customers. Methodology/results: We represent the service system as a stochastic clearing process, heterogeneity in delay cost as a random variable, and heterogeneity in rewards as a positive affine transformation of delay cost. For each information level, we identify the equilibrium behavior of customers and solve the revenue-maximization problem based on this equilibrium. The equilibrium turns out to be unique in each case, and it is of a threshold form in the sense that for each value of the information, it is best to join either for all types of customers, only for those who are sufficiently price sensitive, only for those who are sufficiently delay sensitive, or for none. The optimal fee is also unique in nontrivial cases. This enables us to perform comparisons across different information structures. Managerial implications: The effect of heterogeneity depends highly on model parameters as well as the available information. For a fixed fee, an increase in heterogeneity has a positive overall impact on the customer population, whereas the effect on the revenue can be positive (slow service at a high fee) or negative (fast service at a low fee). Unlike with fixed fee, for the optimal fee, an increase in heterogeneity can have a negative overall effect on customers. Ignoring heterogeneity can lead to a substantial opportunity loss for the system.en_US
dc.description.sponsorshipAXA Research Fund; Marie Curie Career Integration Grant from the European Union [FP7-PEOPLE-2013-CIG, 618853]en_US
dc.description.sponsorshipA. Manou was supported by AXA Research Fund. P. G. Canbolat was supported by Marie Curie Career Integration Grant from the European Union's Seventh Framework Programme (RISK) [FP7-PEOPLE-2013-CIG, Proposal No. 618853] .en_US
dc.identifier.citation0
dc.identifier.doi10.1287/msom.2021.0116
dc.identifier.issn1523-4614
dc.identifier.issn1526-5498
dc.identifier.issue1en_US
dc.identifier.scopus2-s2.0-85183330730
dc.identifier.scopusqualityQ1
dc.identifier.urihttps://doi.org/10.1287/msom.2021.0116
dc.identifier.urihttps://hdl.handle.net/20.500.12469/5799
dc.identifier.volume26en_US
dc.identifier.wosWOS:001084714300001
dc.identifier.wosqualityQ1
dc.language.isoenen_US
dc.publisherinformsen_US
dc.relation.publicationcategoryMakale - Uluslararası Hakemli Dergi - Kurum Öğretim Elemanıen_US
dc.rightsinfo:eu-repo/semantics/openAccessen_US
dc.subjectheterogeneous customersen_US
dc.subjectstrategic behavioren_US
dc.subjectpricingen_US
dc.subjectstochastic transportation systemen_US
dc.subjectdelay informationen_US
dc.titleStrategic Heterogeneous Customers in a Transportation Station: Information and Pricingen_US
dc.typeArticleen_US
dspace.entity.typePublication
relation.isAuthorOfPublicationc73f8fe4-181a-4cd2-bc7f-b35358e26ee6
relation.isAuthorOfPublication.latestForDiscoveryc73f8fe4-181a-4cd2-bc7f-b35358e26ee6

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