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Complexity of solution structures in nonlinear pricing

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Abstract

This paper characterizes and enumerates the possible solution structures in nonlinear pricing problem when the number of buyer types is given. It is shown that the single-crossing property, which is a standard assumption in the literature, reduces the complexity of solving the problem dramatically. The number of possible solution structures is important when the pricing problem is solved under limited information.

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Notes

  1. The author thanks the reviewer for suggesting this definition.

  2. More than one type in a bunch may have outflows.

  3. The author thanks the reviewer for pointing this out in Kokovin et al. (2011).

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Acknowledgements

The author is grateful to Mirko Ruokokoski and Arttu Klemettilä for the helpful comments and suggestions. The author would like to thank the two anonymous reviewers for their valuable suggestions and corrections.

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Correspondence to Kimmo Berg.

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Berg, K. Complexity of solution structures in nonlinear pricing. Ann Oper Res 206, 23–37 (2013). https://doi.org/10.1007/s10479-013-1334-3

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