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August 21, 2025Operations Research

Dynamic Pricing for Reusable Resources: The Power of Two Prices

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Authors

SBSantiago BalseiroWMWill MaWZWenxin Zhang

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Overview

Dynamic pricing shows improved outcomes for reusable resources like hotel rooms and cloud computing, suggesting simplicity can yield gains.

Key Points

  • Optimizing dynamic pricing strategies can lead to significant gains in resource utilization, particularly for hotel rooms and cloud computing.
  • A two-price policy can achieve performance losses similar to those of more complex stock-dependent policies in dynamic pricing.
  • The method utilizes loss networks and a tractable convex optimization problem, making it accessible for practical applications.
  • Simulations reveal that small adjustments in pricing strategy can greatly enhance resource management and profitability.

Cite This Study

Balseiro et al. (2025) studied this question.

synapsesocial.com/papers/68af75207567bf4f94fee89bhttps://doi.org/10.1287/opre.2023.0475
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Also Consider

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  1. 1Dynamic Pricing Strategy Driven by Deep Reinforcement Learning with Empirical Analysis on the Collaborative Optimization of Hotel Revenue Management and Customer Satisfaction2025 · 4 citations
  2. 2Dynamic Pricing for Two-Sided Marketplaces with Offer Expiration2025 · 1 citations
  3. 3Dynamic pricing research based on customers’ limited rational behavior in a competitive environment2025
  4. 4Dynamic pricing strategies to maximize hotel revenues2025
  5. 5Dynamic Pricing for Internet Service Platforms with Initial Demand Constraints: Unified or Differentiated Pricing?2025