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Markov decision process in the problem of dynamic pricing policy

Markov decision process in the problem of dynamic pricing policy Markov decision processes (MDP) are widely used in problems whose solutions may be represented by a certain series of actions. A lot of papers demonstrate successful MDP use in model problems, robotic control problems, planning problems, etc. In addition, economic problems have the property of multistep motion towards a goal as well. This paper is dedicated to MDP application to the problem of pricing policy management. The problem of dynamic pricing is stated in terms of MDP. Additional attention is paid to the method of constructing an MDP model based on data mining. Based on the data on sales of an actual industrial plant, construction of an MDP model that includes the searching for and generalization of regularities is demonstrated. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Automatic Control and Computer Sciences Springer Journals

Markov decision process in the problem of dynamic pricing policy

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Publisher
Springer Journals
Copyright
Copyright © 2011 by Allerton Press, Inc.
Subject
Computer Science; Control Structures and Microprogramming
ISSN
0146-4116
eISSN
1558-108X
DOI
10.3103/S0146411611060058
Publisher site
See Article on Publisher Site

Abstract

Markov decision processes (MDP) are widely used in problems whose solutions may be represented by a certain series of actions. A lot of papers demonstrate successful MDP use in model problems, robotic control problems, planning problems, etc. In addition, economic problems have the property of multistep motion towards a goal as well. This paper is dedicated to MDP application to the problem of pricing policy management. The problem of dynamic pricing is stated in terms of MDP. Additional attention is paid to the method of constructing an MDP model based on data mining. Based on the data on sales of an actual industrial plant, construction of an MDP model that includes the searching for and generalization of regularities is demonstrated.

Journal

Automatic Control and Computer Sciences – Springer Journals

Published: Jan 5, 2012

References

  • Computational Intelligence: Principles, Techniques and Applications
    Konar, A.
  • Operation Research: An Introduction
    Taha, H.A.
  • A Gradient-Based Reinforcement Learning Approach to Dynamic Pricing in Partially-Observable Environment
    Vengerov, D.
  • Matematicheskie metody i modeli v kommercheskoi deyatel’nosti
    Fomin, G.P.