SSRN Author: Edward FoxEdward Fox SSRN Content
http://www.ssrn.com/author=790762
http://www.ssrn.com/rss/en-usThu, 01 Dec 2016 18:58:48 GMTeditor@ssrn.com (Editor)Thu, 01 Dec 2016 18:58:48 GMTwebmaster@ssrn.com (WebMaster)SSRN RSS Generator 1.0REVISION: Choosing an n-Pack of Substitutable ProductsWe develop a framework to model the shopping and consumption decisions of forward-looking consumers. Assuming that the consumer’s future utility for each product alternative can be characterized by a standard random utility model, we use dynamic programming to determine the optimal consumption policy and the maximum expected value of consuming any n substitutable products selected while shopping (an n-pack). We propose two models. In the first (canonical) model, we assume that an alternative is consumed on each successive consumption occasion and obtain a closed-form optimal policy and a closed-form value function. Given a consumer's preferences for the product alternatives in an assortment, we then show how to identify that consumer's optimal n-pack using a simple swapping algorithm that converges in at most n swaps. In the second (generalized) model, we introduce an outside option so that a product alternative need not be consumed on each consumption occasion. We obtain a ...
http://www.ssrn.com/abstract=2476026
http://www.ssrn.com/1536980.htmlWed, 19 Oct 2016 17:43:39 GMTREVISION: Choosing an n-Pack of Substitutable ProductsWe develop a framework to model the shopping and consumption decisions of forward-looking consumers. Assuming that the consumer's future utility for each product alternative can be characterized by a standard random utility model, we use dynamic programming to determine the optimal consumption policy and the maximum expected value of consuming an n-pack of substitutable products. We propose two models. In the first (or canonical) model, we assume that an alternative is consumed on each successive consumption occasion and obtain a closed-form optimal policy and a closed-form value function. Given a consumer's preferences for the product alternatives in an assortment, we then show how to identify that consumer's optimal n-pack using a simple swapping algorithm that converges in at most n swaps. In the second (or generalized) model, we introduce an outside option so that an alternative need not be consumed on each consumption occasion. We obtain a closed-form value function such that ...
http://www.ssrn.com/abstract=2476026
http://www.ssrn.com/1457805.htmlWed, 06 Jan 2016 11:23:34 GMT