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Dynamic Games and Applications Seminar

Pricing, Assortment, and Inventory Decisions under Nested Logit Demand and Equal Profit Margins


Oct 12, 2023   11:00 AM — 12:00 PM

Bacel Maddah American University of Beirut, Lebanon

Bacel Maddah

Presentation on YouTube.

We consider the interdependent decisions on assortment, inventory and pricing of substitutable products under a nested logit consumer choice, and a single-period, newsvendor-type, supply setting. This applies to fashion goods. We assume that all products have equal profit margins. Under a Taylor series-type approximation, we derive several concavity properties of the expected profit function, and gain insights into the structure of the optimal solution. Our results allow developing an efficient, single-variable search, heuristic for jointly deciding on assortment, pricing, and inventory decisions. We argue that our approach continues to hold under more general consumer choice.

Georges Zaccour organizer


Hybrid activity at GERAD
Zoom et salle 4488
Pavillon André-Aisenstadt
Campus de l'Université de Montréal
2920, chemin de la Tour

Montréal Québec H3T 1J4

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