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We develop a variant of the multinomial logit model with impatient customers and study assortment optimization and pricing problems under this choice model. In our choice model, a customer incrementally views the assortment of available products in multiple stages. The patience level of a customer determines the maximum number of stages in which the customer is willing to view the assortments of products. In each stage, if the product with the largest utility provides larger utility than a minimum acceptable utility, which we refer to as the utility of the outside option, then the customer purchases that product right away. Otherwise, the customer views the assortment of products in the next stage as long as the customer’s patience level allows the customer to do so. Under the assumption that the utilities have the Gumbel distribution and are independent, we give a closed-form expression for the choice probabilities. For the assortment-optimization problem, we develop a polynomial-time algorithm to find the revenue-maximizing sequence of assortments to offer. For the pricing problem, we show that, if the sequence of offered assortments is fixed, then we can solve a convex program to find the revenue-maximizing prices, with which the decision variables are the probabilities that a customer reaches different stages. We build on this result to give a 0.878-approximation algorithm when both the sequence of assortments and the prices are decision variables. We consider the assortment-optimization problem when each product occupies some space and there is a constraint on the total space consumption of the offered products. We give a fully polynomial-time approximation scheme for this constrained problem. We use a data set from Expedia to demonstrate that incorporating patience levels, as in our model, can improve purchase predictions. We also check the practical performance of our approximation schemes in terms of both the quality of solutions and the computation times.more » « less
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We examine the revenue–utility assortment optimization problem with the goal of finding an assortment that maximizes a linear combination of the expected revenue of the firm and the expected utility of the customer. This criterion captures the trade-off between the firm-centric objective of maximizing the expected revenue and the customer-centric objective of maximizing the expected utility. The customers choose according to the multinomial logit model, and there is a constraint on the offered assortments characterized by a totally unimodular matrix. We show that we can solve the revenue–utility assortment optimization problem by finding the assortment that maximizes only the expected revenue after adjusting the revenue of each product by the same constant. Finding the appropriate revenue adjustment requires solving a nonconvex optimization problem. We give a parametric linear program to generate a collection of candidate assortments that is guaranteed to include an optimal solution to the revenue–utility assortment optimization problem. This collection of candidate assortments also allows us to construct an efficient frontier that shows the optimal expected revenue–utility pairs as we vary the weights in the objective function. Moreover, we develop an approximation scheme that limits the number of candidate assortments while ensuring a prespecified solution quality. Finally, we discuss practical assortment optimization problems that involve totally unimodular constraints. In our computational experiments, we demonstrate that we can obtain significant improvements in the expected utility without incurring a significant loss in the expected revenue. This paper was accepted by Omar Besbes, revenue management and market analytics.more » « less
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Event cameras, inspired by biological vision systems, provide a natural and data efficient representation of visual information. Visual information is acquired in the form of events that are triggered by local brightness changes. However, because most brightness changes are triggered by relative motion of the camera and the scene, the events recorded at a single sensor location seldom correspond to the same world point. To extract meaningful information from event cameras, it is helpful to register events that were triggered by the same underlying world point. In this work we propose a new model of event data that captures its natural spatio-temporal structure. We start by developing a model for aligned event data. That is, we develop a model for the data as though it has been perfectly registered already. In particular, we model the aligned data as a spatio-temporal Poisson point process. Based on this model, we develop a maximum likelihood approach to registering events that are not yet aligned. That is, we find transformations of the observed events that make them as likely as possible under our model. In particular we extract the camera rotation that leads to the best event alignment. We show new state of the art accuracy for rotational velocity estimation on the DAVIS 240C dataset [??]. In addition, our method is also faster and has lower computational complexity than several competing methods.more » « less