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Contact Information: Tanya Klein Public Relations 973-596-3433

NJIT Industrial Engineer Invited To Discuss Dynamic Pricing at Rutgers University

NJIT Associate Professor Jian Yang, an industrial engineer, recently delivered an invited lecture at Rutgers University about dynamic pricing involving competing firms.   Dynamic pricing is a practice in which a firm adjusts its price in real time for the purpose of profit maximization.

Over a fixed-time horizon, every contestant attempts dynamic pricing to optimally influence demand, which is random and susceptible also to prices offered by other firms. The problem, which possesses features from both game theory and Markov decision processes, is difficult to analyze.  

Yang, however, first studied a nonatomic-game version, which focused on a continuum of infinitesimal firms. Under reasonable assumptions, he identified a well-behaved equilibrium pricing policy.  He then developed a general theory concerning the suitability of related equilibria to finite-game counterparts.

As the players increased, he showed that such equilibria, necessarily insensitive to players’ observations about external conditions, would become ever more suitable for their corresponding finite-player situations. For the original dynamic pricing problem, he  concluded that when there are enough firms and all of them adopt the nonatomic-game version of the equilibrium pricing policy, none of them would have any strong incentive to not follow, even for one period, the pricing policy.

Yang’s research interests are in production planning, inventory control, revenue management, stochastic modeling, and game-theoretic applications. He has published 30 peer-reviewed scholarly articles, and he received research funding from the National Science Foundation and the New Jersey Department of Transportation.

He is a member of the NJIT Department of Mechanical and Industrial Engineering in Newark College of Engineering.   He received his PhD in management science from the University of Texas at Austin. 

One of the nation’s leading public technological universities, New Jersey Institute of Technology (NJIT) is a top-tier research university that prepares students to become leaders in the technology-dependent economy of the 21st century. NJIT’s multidisciplinary curriculum and computing-intensive approach to education provide technological proficiency, business acumen and leadership skills. With an enrollment of 11,400 graduate and undergraduate students, NJIT offers small-campus intimacy with the resources of a major public research university. NJIT is a global leader in such fields as solar research, nanotechnology, resilient design, tissue engineering and cybersecurity, in addition to others. NJIT ranks 5th among U.S. polytechnic universities in research expenditures, topping $121 million, and is among the top 1 percent of public colleges and universities in return on educational investment, according to PayScale.com. NJIT has a $1.74 billion annual economic impact on the State of New Jersey.