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- W3124977205 abstract "Although some firms use dynamic pricing to respond to demand fluctuations, other firms claim that fairness concerns prevent them from raising prices during periods when demand exceeds capacity. This paper explores conditions in which fairness concerns can or cannot cause shortages. In our model, a firm announces a price policy that states its prices during high and low demand, and customers must travel to a venue to learn the current price. We show that the interaction of fairness concerns with travel costs can cause the firm to set stable prices, which leads to shortages during high demand. However, if the firm is able to inform customers about the current price before they incur any travel costs, then dynamic pricing with no shortages is optimal even with strong fairness concerns." @default.
- W3124977205 created "2021-02-01" @default.
- W3124977205 creator A5051548067 @default.
- W3124977205 date "2018-01-01" @default.
- W3124977205 modified "2023-09-23" @default.
- W3124977205 title "Dynamic Pricing with Fairness Concerns and a Capacity Constraint" @default.
- W3124977205 doi "https://doi.org/10.2139/ssrn.3255082" @default.
- W3124977205 hasPublicationYear "2018" @default.
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