5. Conclusion
In this paper, we study a monopolist seller’s revenue management problem with the twist that transactions between the seller and each arriving buyer are bilaterally negotiated, a situation that has not been fully considered in the extant literature. We start with the one-to-one negotiation problems and discuss how to account for uncertainty in valuation distributions. Next, we extend our analysis to the dynamic environment: we establish the connection of the bilateral negotiation problems with the classical revenue management problems; and by studying the deterministic fluid problem, we observe the stationary nature of the optimal pricing policy. We are then able to extend the analysis to uncertain environments. Finally, two sets of numerical analyzes complement the theoretical study in other interesting perspectives, answering the questions “how the impact of parameter k in a dynamic setting might be different than in a static setting” and “how the uniform distribution assumption might affect the performance of the seller”.
