Estimating Buyer Willingness-to-Pay and Seller Reserve Prices from Negotiation Data and the Implications for Pricing

We consider a company selling heterogeneous products where the final price is set by negotiation between sales agents and customers. Negotiation is common in many industries including retail automotive sales, consumer lending, insurance and many business-to-business markets. We assume that each sales agent has a minimum reserve price that he/she will accept… CONTINUE READING