Optimal investment strategy of a free-floating sharing platform

Xiaojie Sun, Wansheng Tang, Jing Chen and Jianxiong Zhang

Transportation Research Part E: Logistics and Transportation Review, 2020, vol. 138, issue C

Abstract: Recent free-floating platforms offer service to consumers via a sharing model that can substantially increases the service’s circulation and utilization. This paper examines the optimal investment strategy in product quality, input quantity, and dynamic advertising for a free-floating sharing platform that owns a durable product and leases it to consumers. We model the problem as an optimal control problem and solve it via the maximum principle and an algorithm. We discuss four investment strategies, one single-stage strategy and three two-stage strategies (flexible quality, flexible quantity, and dual-flexible). Our findings provide new insights and implications into the sharing platform’s investment strategy.

Keywords: Sharing economy; Investment strategy; Optimal control; Multi-stage modeling (search for similar items in EconPapers)
Date: 2020
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Citations: View citations in EconPapers (11)

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DOI: 10.1016/j.tre.2020.101958

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