A multi-stage optimal control approach of durable goods pricing and the launch of new product generations
- Autor(en)
- Andrea Seidl, Richard Hartl, Peter M. Kort
- Abstrakt
We analyze the problem of a firm that sells durable goods. In particular, we investigate how this firm optimally combines continuous-time operational-level planning (continuously deciding on capacity investment) with discrete decision making (when to launch a new generation of the product, how to price a particular generation of the product).
We find that a firm should invest most into its production capacity just after the introduction of a new product. Then there is a large number of potential customers and thus a large production capacity is needed to fulfill demand. The extent to which existing capacity can still be used in the production process for the next generation has a non-monotonic effect on the optimal timing of launching a new generation as well as on its price. We show that the optimal price declines with each new product generation.- Organisation(en)
- Institut für Business Decisions and Analytics
- Externe Organisation(en)
- Tilburg University, University of Antwerp
- Journal
- Automatica
- Band
- 106
- Seiten
- 207-220
- Anzahl der Seiten
- 14
- ISSN
- 0005-1098
- DOI
- https://doi.org/10.1016/j.automatica.2019.05.009
- Publikationsdatum
- 08-2019
- Peer-reviewed
- Ja
- ÖFOS 2012
- 502028 Produktionswirtschaft
- Schlagwörter
- ASJC Scopus Sachgebiete
- Control and Optimization, Management of Technology and Innovation, Management Science and Operations Research, Electrical and Electronic Engineering, Control and Systems Engineering
- Link zum Portal
- https://ucris.univie.ac.at/portal/de/publications/a-multistage-optimal-control-approach-of-durable-goods-pricing-and-the-launch-of-new-product-generations(6571015e-e6f3-4117-8329-554d26f3e2b8).html