Intertemporal Pricing with Unobserved Consumer Arrival Times

Philippe Choné, Romain de Nijs and Lionel Wilner

No 2012-23, Working Papers from Center for Research in Economics and Statistics

Abstract: We examine optimal selling mechanisms with ex-ante commitment for a nondurable good when the seller does not observe the times at which strategic consumers arrive on the market and how much they are willing to pay for the good. Assuming consumer risk neutrality, we demonstrate in this two-dimensional screening problem that stochastic mechanisms are suboptimal. In practice, this means that quantity rationing and behavior-based price discrimination do not improve the profit compared to a simple time-dependent price schedule. We explain how the optimal profit may be achieved with a first-come first-served policy

Keywords: Intertemporal pricing; Strategic consumers; Arrival dates; Heterogeneous cohorts; two-dimensional screening (search for similar items in EconPapers)
JEL-codes: D11 D42 D82 (search for similar items in EconPapers)
Pages: 22
Date: 2012-10
New Economics Papers: this item is included in nep-com, nep-ind, nep-mic and nep-mkt
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