In this paper, we consider the joint effects of product substitution and endogenized market size. Under the substitution effects, a product's demand may be cannibalized by other substitutable products; while the market size, measured by the number of customers who are interested in one of the...

We investigate heterogeneous customer choice behavior in the presence of main products, ancillary services with options of pay-per-use and subscription, as well as the outside option. The willingness to pay for service subscription is derived as a closed-form expression, which enables us to...

Network externality arises when the utility of a product depends not only on its attributes, but also on the number of consumers who purchase the same product. In this paper, we propose and analyze consumer choice models that endogenize such network externality. We first characterize the choice...

We propose and study a threshold utility model (TUM) where consumers buy any product whose net utility exceeds a non-negative, product-specific threshold. The thresholds are selected to maximize the expected surplus of the representative consumer subject to a bound on the expected number of...

In the k-prophet problem, a decision maker observes n items sequentially and selects up to k n items without recourse to maximize the total expected reward of the selected items. We consider a soft version of the problem where the decision maker can select up to k items in expectation rather...

Exponential bandits are widely adopted in economics and marketing due to their tractability. This paper analyzes the one-agent multi-armed account of exponential bandits, where the agent dynamically selects arms to maximize total payoff. We motivate our base model by examples with arms being of...