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He also suggests that the temporal pricing discrimination adopted by duopolistic low-cost markets is a threat to the recovery of all fixed costs.
Indeed, the WZH reservation model, which R&C's brokerage model extends, is described by the authors as a mechanism that "extracts revenue similar to that of a monopoly provider practicing temporal pricing discrimination with a user population whose preference distribution is known in advance"[11]).
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Temporal price dispersion is measured by comparing how stores' prices are ranked over time.
Varian (1980) was among the first to distinguish between spatial and temporal price dispersion.
Temporal price dispersion arises when the store's position in a price-based ranking changes over time.
We observe temporal price dispersion when the identity of the store offering the lowest (and highest) price varies over time.
Existing approaches are difficult to solve the problem because they do not make full use of temporal price differences.
Recall that a smaller value of beta means that the airline is less able to exploit temporal price discrimination.
Without considering temporal price differences, aforementioned schemes are difficult to make the profit maximization in the dynamic virtual resource pricing model.
Our results show that easyJet's temporal price discrimination tends to decrease after a new entry, especially when the new entrant is a traditional carrier.
Taking full advantage of the temporal price differences and the delay tolerance of the task, this paper presents a dynamic virtual resource renting approach.
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Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com