Trade-In Programs in the Context of Technological Innovation with Herding

Paolo Pellizzari, Elena Sartori () and Marco Tolotti
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Elena Sartori: University of Padua

A chapter in Advances in Artificial Economics, 2015, pp 219-230 from Springer

Abstract: Abstract We study optimal pricing strategies and consequent market shares’ dynamics in a transition from an old and established technology to a new one. We simulate an agent-based model, in which a large population of possible buyers decide whether to adopt or not depending on prices, private signals and herding behavior. The firm, on its part, sets prices to maximize revenues. We show that trade-in programs, in practice comparable to very aggressive discounts, are supported by a rational attitude.

Keywords: Market Share; Optimal Price; Private Signal; Potential Adopter; Price Schedule (search for similar items in EconPapers)
Date: 2015
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Working Paper: Trade-in programs in the context of technological innovation with herding (2014)
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DOI: 10.1007/978-3-319-09578-3_18

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