| This dissertation investigates a number of related topics in dynamic multiproduct pricing arising in a competitive setting in markets with memory-sensitive consumers. The first problem is concerned with simultaneous pricing of a line of several products, both complementary products and substitutes, with a number of distinct price differentiation classes for each product. A game-theoretic problem extension where the product line demand is sensitive to prices of outside competitors' products is also considered. The second problem features a number of firms simultaneously competing in price and inventory level decisions, and considers the effect of excess demand, where the firm faces part of the demand its competitors could not satisfy because of stockout. An iterative relaxation algorithm is proposed to solve the problems stated, and sufficient conditions for convergence of the algorithm are proven. Extensive computational examples and a case study are included to illustrate solutions' practical applications.;The third problem is concerned with profit-maximizing product innovation and pricing for firms that produce and sell short life-cycle products in a competitive environment. We incorporate the effects reference innovation level and reference price have on profits, and model consumers in the market with two attributes: their sensitivity to product innovation levels and their sensitivity to product prices. We characterize both open-loop and closed-loop Nash equilibria for competition among firms that execute different types of product innovation and pricing strategies.;The fourth problem deals with a firm's decision on the product introduction timing and pricing for successive product generations in the presence of consumer memory. We analyze the case where a firm introduces multiple generations of a product, for which demand is impacted by the reference price formed by consumers' shopping experience. We characterize the product introduction timing and pricing strategies explicitly for two successive product generations, and propose a quasi-analytic solution method, based on the structure of the memory-dependent problem, for an arbitrary number of generations. We also extend our analysis to a duopoly environment. Our results help firms manage development and sales of their multiple product generations.;Finally, we also include the summary of our recent results on the application of vehicular traffic theory to blood rheology, a collaborative effort with the Department of Cardiology. |
