Research Article
Dynamic Nonlinear Pricing Model Based on Adaptive and Sophisticated Learning
| | denote, respectively, the propensity of adaptive and sophisticated consumers to good | | are the adaptive and sophisticated consumers’ estimate for the quality or goodwill of good , respectively. and | | The price of good . | | are the adaptive and sophisticated consumers’ relative quality or goodwill of two goods, respectively. | | is the relative price of two goods. | | are the probability that the adaptive consumers, sophisticated consumers choose good , respectively. | | measures the sensitivity of consumers for goods. . | | is the utility which is got by consuming good at time , | | is the “recency” parameter of preference for purchased goods. | | is the “recency” parameter of preference for goods which are not purchased. | | is the ratio of “recency” parameters described by and . | | respects the influence coefficient from other consumers to sophisticated consumers. | | is the ratio of influence coefficient and “recency” parameter . |
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