Joint dynamic pricing and capacity control for hotels and rentals with advanced demand information

Weifen Zhuang, Jiguang Chen, Xiaowen Fu

Research output: Journal article publicationJournal articleAcademic researchpeer-review

7 Citations (Scopus)

Abstract

This paper studies joint dynamic pricing and capacity control for hotel and rental operations when advanced demand information (ADI) is available for some but not all customers. Dynamic pricing for non-ADI customers and capacity control for ADI customers are jointly considered with a stochastic dynamic programming model. We examine structural properties and fully characterize optimal policies. Based on monotone properties of optimal policies, we develop effective pricing and rationing heuristics, and investigate the value of demand information through numerical studies.

Original languageEnglish
Pages (from-to)397-402
Number of pages6
JournalOperations Research Letters
Volume45
Issue number5
DOIs
Publication statusPublished - 1 Sep 2017
Externally publishedYes

Keywords

  • Advanced demand information
  • Capacity control
  • Dynamic pricing
  • Hotels and rentals

ASJC Scopus subject areas

  • Software
  • Management Science and Operations Research
  • Industrial and Manufacturing Engineering
  • Applied Mathematics

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