Limitations of Nature-Inspired Algorithms for Pricing on Digital Platforms

Digital platforms have begun to rely more on algorithms perform basic tasks such as pricing. These must set prices that coordinate two or sides need each other in some way (e.g., developers and users buyers sellers). Therefore, it is essential form correct expectations about how both behave. The purpose of this paper was study the effect different levels information biology-inspired metaheuristics (differential evolution particle swarm optimization algorithms) were programmed multisided platforms. We assumed one platform always formed (human platform) while competitor used a generic version differential algorithms. tested modified formed. found might end up suboptimal solutions, showing needed account for expectation formation explicitly risk setting nonoptimal prices. In addition, we regularity when they incorrect can help practitioners detect cases intervention.