Refine
Has Fulltext
- no (17)
Document Type
- Article (17) (remove)
Language
- English (17) (remove)
Is part of the Bibliography
- yes (17)
Keywords
- Dynamic pricing (4)
- heuristics (3)
- Dynamic pricing and advertising (2)
- Dynamic programming (2)
- E-commerce (2)
- Oligopoly competition (2)
- dynamic (2)
- dynamic programming (2)
- risk aversion (2)
- Adoption effects (1)
In discrete manufacturing, the knowledge about causal relationships makes it possible to avoid unforeseen production downtimes by identifying their root causes. Learning causal structures from real-world settings remains challenging due to high-dimensional data, a mix of discrete and continuous variables, and requirements for preprocessing log data under the causal perspective. In our work, we address these challenges proposing a process for causal reasoning based on raw machine log data from production monitoring. Within this process, we define a set of transformation rules to extract independent and identically distributed observations. Further, we incorporate a variable selection step to handle high-dimensionality and a discretization step to include continuous variables. We enrich a commonly used causal structure learning algorithm with domain-related orientation rules, which provides a basis for causal reasoning. We demonstrate the process on a real-world dataset from a globally operating precision mechanical engineering company. The dataset contains over 40 million log data entries from production monitoring of a single machine. In this context, we determine the causal structures embedded in operational processes. Further, we examine causal effects to support machine operators in avoiding unforeseen production stops, i.e., by detaining machine operators from drawing false conclusions on impacting factors of unforeseen production stops based on experience.
In this paper, we analyze stochastic dynamic pricing and advertising differential games in special oligopoly markets with constant price and advertising elasticity. We consider the sale of perishable as well as durable goods and include adoption effects in the demand. Based on a unique stochastic feedback Nash equilibrium, we derive closed-form solution formulas of the value functions and the optimal feedback policies of all competing firms. Efficient simulation techniques are used to evaluate optimally controlled sales processes over time. This way, the evolution of optimal controls as well as the firms’ profit distributions are analyzed. Moreover, we are able to compare feedback solutions of the stochastic model with its deterministic counterpart. We show that the market power of the competing firms is exactly the same as in the deterministic version of the model. Further, we discover two fundamental effects that determine the relation between both models. First, the volatility in demand results in a decline of expected profits compared to the deterministic model. Second, we find that saturation effects in demand have an opposite character. We show that the second effect can be strong enough to either exactly balance or even overcompensate the first one. As a result we are able to identify cases in which feedback solutions of the deterministic model provide useful approximations of solutions of the stochastic model.
Challenges for self-driving database systems, which tune their physical design and configuration autonomously, are manifold: Such systems have to anticipate future workloads, find robust configurations efficiently, and incorporate knowledge gained by previous actions into later decisions. We present a component-based framework for self-driving database systems that enables database integration and development of self-managing functionality with low overhead by relying on separation of concerns. By keeping the components of the framework reusable and exchangeable, experiments are simplified, which promotes further research in that area. Moreover, to optimize multiple mutually dependent features, e.g., index selection and compression configurations, we propose a linear programming (LP) based algorithm to derive an efficient tuning order automatically. Afterwards, we demonstrate the applicability and scalability of our approach with reproducible examples.
In many businesses, firms are selling different types of products, which share mutual substitution effects in demand. To compute effective pricing strategies is challenging as the sales probabilities of each of a firm's products can also be affected by the prices of potential substitutes. In this paper, we analyze stochastic dynamic multi-product pricing models for the sale of perishable goods. To circumvent the limitations of time-consuming optimal solutions for highly complex models, we propose different relaxation techniques, which allow to reduce the size of critical model components, such as the state space, the action space, or the set of potential sales events. Our heuristics are able to decrease the size of those components by forming corresponding clusters and using subsets of representative elements. Using numerical examples, we verify that our heuristics make it possible to dramatically reduce the computation time while still obtaining close-to-optimal expected profits. Further, we show that our heuristics are (i) flexible, (ii) scalable, and (iii) can be arbitrarily combined in a mutually supportive way.
In many revenue management applications risk-averse decision-making is crucial. In dynamic settings, however, it is challenging to find the right balance between maximizing expected rewards and minimizing various kinds of risk. In existing approaches utility functions, chance constraints, or (conditional) value at risk considerations are used to influence the distribution of rewards in a preferred way. Nevertheless, common techniques are not flexible enough and typically numerically complex. In our model, we exploit the fact that a distribution is characterized by its mean and higher moments. We present a multi-valued dynamic programming heuristic to compute risk-sensitive feedback policies that are able to directly control the moments of future rewards. Our approach is based on recursive formulations of higher moments and does not require an extension of the state space. Finally, we propose a self-tuning algorithm, which allows to identify feedback policies that approximate predetermined (risk-sensitive) target distributions. We illustrate the effectiveness and the flexibility of our approach for different dynamic pricing scenarios. (C) 2020 Elsevier Ltd. All rights reserved.
The demand for peer-to-peer ridesharing services increased over the last years rapidly. To cost-efficiently dispatch orders and communicate accurate pick-up times is challenging as the current location of each available driver is not exactly known since observed locations can be outdated for several seconds. The developed trajectory visualization tool enables transportation network companies to analyze dispatch processes and determine the causes of unexpected delays. As dispatching algorithms are based on the accuracy of arrival time predictions, we account for factors like noise, sample rate, technical and economic limitations as well as the duration of the entire process as they have an impact on the accuracy of spatio-temporal data. To improve dispatching strategies, we propose a prediction approach that provides a probability distribution for a driver’s future locations based on patterns observed in past trajectories. We demonstrate the capabilities of our prediction results to ( i) avoid critical delays, (ii) to estimate waiting times with higher confidence, and (iii) to enable risk considerations in dispatching strategies.
Currently available wearables are usually based on a single sensor node with integrated capabilities for classifying different activities. The next generation of cooperative wearables could be able to identify not only activities, but also to evaluate them qualitatively using the data of several sensor nodes attached to the body, to provide detailed feedback for the improvement of the execution. Especially within the application domains of sports and health-care, such immediate feedback to the execution of body movements is crucial for (re-) learning and improving motor skills. To enable such systems for a broad range of activities, generalized approaches for human motion assessment within sensor networks are required. In this paper, we present a generalized trainable activity assessment chain (AAC) for the online assessment of periodic human activity within a wireless body area network. AAC evaluates the execution of separate movements of a prior trained activity on a fine-grained quality scale. We connect qualitative assessment with human knowledge by projecting the AAC on the hierarchical decomposition of motion performed by the human body as well as establishing the assessment on a kinematic evaluation of biomechanically distinct motion fragments. We evaluate AAC in a real-world setting and show that AAC successfully delimits the movements of correctly performed activity from faulty executions and provides detailed reasons for the activity assessment.
Indexes are essential for the efficient processing of database workloads. Proposed solutions for the relevant and challenging index selection problem range from metadata-based simple heuristics, over sophisticated multi-step algorithms, to approaches that yield optimal results. The main challenges are (i) to accurately determine the effect of an index on the workload cost while considering the interaction of indexes and (ii) a large number of possible combinations resulting from workloads containing many queries and massive schemata with possibly thousands of attributes. <br /> In this work, we describe and analyze eight index selection algorithms that are based on different concepts and compare them along different dimensions, such as solution quality, runtime, multi-column support, solution granularity, and complexity. In particular, we analyze the solutions of the algorithms for the challenging analytical Join Order, TPC-H, and TPC-DS benchmarks. Afterward, we assess strengths and weaknesses, infer insights for index selection in general and each approach individually, before we give recommendations on when to use which approach.
This paper examines the sale of a finite number of items in a class of stochastic dynamic pricing and advertising models with time-dependent demand elasticities. We prove structural properties of the optimal expected profits with respect to time, inventory level, price impact, advertising impact and different model parameters, such as discount rate, marginal unit costs, and holding costs. We find that the value of an additional item (opportunity costs) is decreasing in the unit costs, the discount rate, the holding cost rate and the number of items left to sell. We also derive structural properties of optimal joint pricing and advertising strategies. This way, we obtain general qualitative insights in the complex interplay and the mutual dependence of optimal pricing and advertising decisions. Among other properties, we show that a higher advertising impact leads to higher optimal prices and lower advertising rates, which in turn implies a lower speed of sale. The results obtained help practitioners to respond to changes in market conditions by adjusting price and advertising accordingly. Our results allow speeding up numerical computations of decisions as the set of possible actions can be reduced significantly. Our analysis implies general results for pure pricing as well as pure advertising models with time-dependent demand elasticities. (C) 2016 Elsevier B.V. All rights reserved.
In dynamic decision problems, it is challenging to find the right balance between maximizing expected rewards and minimizing risks. In this paper, we consider NP-hard mean-variance (MV) optimization problems in Markov decision processes with a finite time horizon. We present a heuristic approach to solve MV problems, which is based on state-dependent risk aversion and efficient dynamic programming techniques. Our approach can also be applied to mean-semivariance (MSV) problems, which particularly focus on the downside risk. We demonstrate the applicability and the effectiveness of our heuristic for dynamic pricing applications. Using reproducible examples, we show that our approach outperforms existing state-of-the-art benchmark models for MV and MSV problems while also providing competitive runtimes. Further, compared to models based on constant risk levels, we find that state-dependent risk aversion allows to more effectively intervene in case sales processes deviate from their planned paths. Our concepts are domain independent, easy to implement and of low computational complexity.