How to govern the big data discriminatory pricing behavior in the platform service supply chain?An examination with a three-party evolutionary game model

Weihua Liu, Shangsong Long, Dong Xie, Yanjie Liang and Jinkun Wang

International Journal of Production Economics, 2021, vol. 231, issue C

Abstract: In recent years, the big data discriminatory pricing (BDDP) behavior of the service platform has recurrently appeared in the platform service supply chain, which is considered as a scandal that is irresponsible to the consumers. Therefore, how to effectively govern the service platform has become an important research topic. Based on this background, this study considers the strategies of the service platform, the government and the consumers, builds a three-party evolutionary game model, and puts forward a governance mechanism for preventing the service platform from using BDDP. This study has drawn many interesting conclusions. First, when the service platform is risk-neutral, if the government does not supervise the platform, the government should set a high tax rate; conversely, if the government chooses to supervise the platform, the tax rate can remain unchanged, and the government can set a high penalty. Second, considering the risk aversion of the platform, if the government does not supervise, not only high tax rate but also low tax rate will be effective; the specific value of the tax rate at this time is determined by the risk aversion factor. When platforms are supervised by the government, a high penalty can be imposed, but the penalty may decrease as the platform risk aversion factor increases. Third, in situations in which the government has no incentive for long-term supervision since the supervision cost is greater than the supervision revenue, the service platform has the incentive to carry out BDDP and consumers do not give the service platform bad evaluations, if the government sets a high penalty, the service platform will recurrently, but not always, carry out BDDP.

Keywords: Big data discriminatory pricing; The service platform; Three-party evolutionary game model; Risk aversion; Governance mechanism (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (19)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:proeco:v:231:y:2021:i:c:s092552732030270x

DOI: 10.1016/j.ijpe.2020.107910

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