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| Main Authors: | , |
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| Format: | Preprint |
| Published: |
2025
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| Subjects: | |
| Online Access: | https://arxiv.org/abs/2510.21951 |
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| _version_ | 1866912745418391552 |
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| author | Wang, Yijin Bose, Subhonmesh |
| author_facet | Wang, Yijin Bose, Subhonmesh |
| contents | We propose a generalization of the Bass diffusion model in discrete-time that explicitly models the effect of price in adoption. Our model is different from earlier price-incorporated models and fits well to adoption data for various products. We then utilize this model to study two decision-making problems. First, we provide a series of structural results on optimal pricing strategies to maximize profits from product sales by a monopolist over a finite horizon. We fully characterize the optimal pricing strategy in the single-period problem, and establish several structural properties of the same for the multi-period counterpart. Second, we study a Stackelberg game between a policy-maker and a monopolist, where the former seeks to maximize adoption through rebates, while the latter focuses on profits. For this problem, we analytically characterize crucial properties of the equilibrium path of the single-period game, and demonstrate how they carry over to the multi-period variant. |
| format | Preprint |
| id |
arxiv_https___arxiv_org_abs_2510_21951 |
| institution | arXiv |
| publishDate | 2025 |
| record_format | arxiv |
| spellingShingle | Pricing Problems in Adoption of New Technologies Wang, Yijin Bose, Subhonmesh Systems and Control We propose a generalization of the Bass diffusion model in discrete-time that explicitly models the effect of price in adoption. Our model is different from earlier price-incorporated models and fits well to adoption data for various products. We then utilize this model to study two decision-making problems. First, we provide a series of structural results on optimal pricing strategies to maximize profits from product sales by a monopolist over a finite horizon. We fully characterize the optimal pricing strategy in the single-period problem, and establish several structural properties of the same for the multi-period counterpart. Second, we study a Stackelberg game between a policy-maker and a monopolist, where the former seeks to maximize adoption through rebates, while the latter focuses on profits. For this problem, we analytically characterize crucial properties of the equilibrium path of the single-period game, and demonstrate how they carry over to the multi-period variant. |
| title | Pricing Problems in Adoption of New Technologies |
| topic | Systems and Control |
| url | https://arxiv.org/abs/2510.21951 |