Informs 2015

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INFORMS Philadelphia – 2015
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MB44
44-Room 103B, CC
Joint Session RMP/HAS: Health Care Pricing
Sponsor: Revenue Management and Pricing
Sponsored Session
Chair: Margret Bjarnadottir, Assistant Professor of Management Science
and Statistics, Robert H. Smith School of Business, University of
Maryland, 4324 Van Munching Hall, College Park, MD, 20742,
United States of America,
Co-Chair: Wedad Elmaghraby, Associate Professor, University of
Maryland, University of Maryland, 4311 Van Munching Hall,
College Park, MD, 20742, United States of America,
1 - Drug Pricing for Pharmaceutical Manufacturers Distributing
through a Common PBM
Nan Yang, Assistant Professor, University of Washington at
St. Louis, St. Louis, MO, 63130, United States of America,
Yixuan Xiao, Panos Kouvelis
We model the competition among branded drug manufacturers on prices when
contracting with a common PBM, who manages the prescription drugs of all
manufacturers on behalf of their clients. We analyze the PBM’s optimal formulary
design problem and characterize the equilibrium pricing behavior of competing
drug manufacturers. We discuss the impact of various parameters on the
equilibrium outcomes for plan enrollees, PBM, and drug manufacturers.
2 - Bundle Payments vs. Fee-for-Service: Impact of Payment Scheme
on Performance
Elodie Adida, University of California at Riverside, Riverside, CA,
, Hamed Mamani, Shima Nassiri
Healthcare payments in the US have been based on a fee-for-service scheme,
which provides incentives for high volume of care. The new healthcare legislation
tests Bundled Payments that remove such incentives. We analyze effects of
different payment schemes on the extent of patient selection and treatment
intensity decisions by a risk-averse provider. We benchmark performance on the
socially optimal outcome. We investigate modified payment systems that induce
this social optimum.
3 - Information Elicitation and Influenza Vaccine Production
Sameer Hasija, Assistant Professor, INSEAD, 1 Ayer Rajah
Avenue, Grange Heights, Singapore, Singapore,
Javad Nasiry, Stephen Chick
We explore the procurement of influenza vaccines by a government whose
objective is to minimize the expected social costs (including vaccine, vaccine
administration, and influenza treatment costs) when a for-profit vaccine supplier
has production yield uncertainty, private information about its productivity
(adverse selection) and potentially unverifiable production effort (moral hazard).
MB45
45-Room 103C, CC
Dynamic Pricing: Learning, Personalization,
Equilibrium, and Consumer Benefit
Sponsor: Revenue Management and Pricing
Sponsored Session
Chair: Stefanus Jasin, Stephen M. Ross School of Business, University
of Michigan, Ann Arbor, MI, United States of America,
1 - Dynamic Pricing and Learning with Online Retail Rankings
Arnoud Den Boer, Assistant Professor, University of Twente,
Gebouw Zilverling, kamer 4013, Drienerlolaan 5, Enschede, 7522
NB, Netherlands, , Bora Keskin
In online market environments such as Amazon or Google Shopping, firms
receive advertisement space if they satisfy certain conditions. It is beforehand not
clear if the benefits of this increased exposure outweigh the potential costs. We
investigate this question in a dynamic pricing-and-learning setting.
.
2 - Personalized Assortment Planning with Finite Inventory and
Demand Uncertainty
David Simchi-levi, Professor, Massachusetts Institute of
Technology, 77 Massachusetts Avenue, Cambridge, MA, 02139,
United States of America, , Clark Pixton
Motivated by the trend among consumers of smartphone usage for shopping
online, we develop an algorithm for personalized assortment optimization over a
finite horizon with finite inventory, in the case where customer choice
parameters are not known. The algorithm simultaneously balances short term
revenues, marginal cost of inventory, and exploration to achieve good
performance in terms of regret.
3 - Stochastic Market Equilibrium for RM
Florin Ciocan, INSEAD, Boulevard de Constance 77305,
Fontainebleu, France, , Vahab Mirrokni,
Mohammadhossein Bateni, Yiwei Chen
We present a dynamic pricing scheme for a seller who is allocating a volatile
stream of goods to a set of budgeted buyers. Our prices are computed as a
stochastic market equilibrium. We provide performance guarantees both in terms
of revenues for the seller and in terms of fairness for the buyers. We apply our
scheme to online ad allocation and using a dataset from a large ad network we
empirically compare the performance of out scheme with the second price ad
auction which is currently run.
4 - Do Consumers Benefit from Dynamic Pricing?
Guillermo Gallego, Columbia University, 820 CEPSR,
530 West 120th Street, MC 470, New York, NY, 10027, United
States of America, , Ningyuan Chen
Inuitively, the seller benefits from dynamic pricing by extracting more of the
consumers’ surplus. Is this right? We start by looking at simpler questions: Do
consumers prefer random prices? Is the consumer surplus a decreasing convex
function of price? Is the optimal price an increasing concave function of cost? If
true, is dynamic pricing better than optimal fixed pricing for consumers? We
show that the answer to these questions are positive most of the time, but there
are some exceptions.
MB46
46-Room 104A, CC
The Economics and Operation of Vehicle Sharing
Sponsor: Manufacturing & Service Oper Mgmt/Service Operations
Sponsored Session
Chair: Saif Benjaafar, Professor, University of Minnesota, 111 Church
Street SE, Minneapolis, MN, 55455, United States of America,
Co-Chair: Guangwen Kong, University of Minnesota, 111 Church
Street SE, Minneapolis, MN, 55414, United States of America,
1 - Contracting with Overconfident Customers in Car Sharing
Guangwen Kong, University of Minnesota, 111 Church Street SE,
Minneapolis, MN, 55414, United States of America,
, Diwakar Gupta
Although the economic and environmental benefits of car-sharing services are
well documented, many potential customers are reluctant to utilize such services.
This has been attributed to, in part, the lack of flexibility of short-term rental
contracts. We study potential impact of customers’ overconfidence when making
reservations, and design the contracts that incorporate customers’ bounded
rationality.
2 - Inventory Rebalancing in Vehicle Sharing Networks
Saif Benjaafar, Professor, University of Minnesota, 111 Church
Street SE, Minneapolis, MN, 55455, United States of America,
Xiaobo Li, Xiang Li
We study the problem of inventory rebalancing in vehicle sharing networks. We
characterize the structure of an optimal policy.
3 - Dynamic Service Management of One-way Car Sharing Systems
Ho-Yin Mak, University of Oxford, Saod Business School, Park
End Street, Oxford, United Kingdom, ,
Guangrui Ma
One-way car sharing services (e.g., Car2go) are gaining popularity. The key
operational challenge is unbalanced flow of vehicles within the service region, as
customers are allowed to return cars anywhere within the service region. We
investigate dynamic service blocking, i.e., restrictions of the set of return
locations, as a possible measure to counter imbalance. We formulate a model that
determines the blocking policy dynamically, incorporating customer destination
choice behavior.
MB46