Pricing Optimization for Selling Reusable Resources

The market for selling reusable products is growing rapidly. Existing works for policy optimization often ignore the dynamic property of demand and the competition among providers. This paper studies service providers’ dynamic pricing in consideration of market competition and dynamics, which makes two key contributions. First, we propose a comprehensive model that takes into account the dynamic demand under market competition and formulate the optimal pricing policy as an equilibrium. Second, as it is difficult to compute the Nash equilibrium due to incomplete information and implicit revenue function, we develop an efficient algorithm to calculate an approximate equilibrium, which is more practical in the real world. The experiments show that the proposed policy outperforms existing strategies and the incentive to deviate the approximate equilibrium is small.