Approximation algorithms for pricing with negative network externalities

doi:10.1007/s10878-015-9988-1

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	Approximation algorithms for pricing with negative network externalities
	Cao, Zhigang 1; Chen, Xujin1 ; Hu, Xiaodong1 ; Wang, Changjun 2
	2017-02-01
发表期刊	JOURNAL OF COMBINATORIAL OPTIMIZATION
ISSN	1382-6905
卷号	33 期号:2 页码:681-712
摘要	We study the problems of pricing an indivisible product to consumers who are embedded in a given social network. The goal is to maximize the revenue of the seller by the so-called iterative pricing that offers consumers a sequence of prices over time. The consumers are assumed to be impatient in that they buy the product as soon as the seller posts a price not greater than their valuations of the product. The product's value for a consumer is determined by two factors: a fixed consumer-specified intrinsic value and a variable externality that is exerted from the consumer's neighbors in a linear way. We focus on the scenario of negative externalities, which captures many interesting situations, but is much less understood in comparison with its positive externality counterpart. Assuming complete information about the network, consumers' intrinsic values, and the negative externalities, we prove that it is NP-hard to find an optimal iterative pricing, even for unweighted tree networks with uniform intrinsic values. Complementary to the hardness result, we design a 2-approximation algorithm for general weighted networks with (possibly) nonuniform intrinsic values. We show that, as an approximation to optimal iterative pricing, single pricing works fairly well for many interesting cases, such as forests, ErdAs-R,nyi networks and Barabasi-Albert networks, although its worst-case performance can be arbitrarily bad in general networks.
关键词	Pricing Approximation algorithms NP-hardness Social networks Random networks Negative externalities
DOI	10.1007/s10878-015-9988-1
语种	英语
资助项目	NNSF of China[11531014] ; NNSF of China[11222109] ; NNSF of China[11471326] ; CAS Program for Cross & Cooperative Team of Science & Technology Innovation
WOS研究方向	Computer Science ; Mathematics
WOS类目	Computer Science, Interdisciplinary Applications ; Mathematics, Applied
WOS记录号	WOS:000394241000019
出版者	SPRINGER
引用统计
文献类型	期刊论文
条目标识符	http://ir.amss.ac.cn/handle/2S8OKBNM/24706
专题	应用数学研究所
通讯作者	Wang, Changjun
作者单位	1.Chinese Acad Sci, Acad Math & Syst Sci, Beijing 100190, Peoples R China 2.Beijing Univ Technol, Beijing Inst Sci & Engn Comp, Beijing 100124, Peoples R China
推荐引用方式 GB/T 7714	Cao, Zhigang,Chen, Xujin,Hu, Xiaodong,et al. Approximation algorithms for pricing with negative network externalities[J]. JOURNAL OF COMBINATORIAL OPTIMIZATION,2017,33(2):681-712.
APA	Cao, Zhigang,Chen, Xujin,Hu, Xiaodong,&Wang, Changjun.(2017).Approximation algorithms for pricing with negative network externalities.JOURNAL OF COMBINATORIAL OPTIMIZATION,33(2),681-712.
MLA	Cao, Zhigang,et al."Approximation algorithms for pricing with negative network externalities".JOURNAL OF COMBINATORIAL OPTIMIZATION 33.2(2017):681-712.