<p>Objective - I am building a dynamic pricing tool for airline tickets which will consider the competitor prices. Taking competitor price as reference, this tool will price the ticket. Also instead of price simultaneously need to follow the lead player in the market and price the ticket.</p>
<p>In the research found out two models</p>
<blockquote>
<ol>
<li>Bertrand Model 2) Stackelberg Model</li>
</ol>
</blockquote>
<p>As per my knowledge Bertrand model is competing on prices and stackelberg competing with quantities.</p>
<p>As airline is a industry which has capacity constraints (i.e can't compete on quantities), I have mainly two queries related to stackelberg model</p>
<blockquote>
<p>1). can I use stackelberg(leader-follower) model/concept,
if need to compete with prices instead of quantities.</p>
<p>2). Can stackelberg be used with multiple leaders (more than 2) ?</p>
<p>3). Or Is there any combination of both models for example something called
bertrand-stackelberg</p>
</blockquote>
<p>Can anyone help with insights. Thanks in advance</p>

CC BY-SA 4.0
2021-05-12T17:02:35.780Z
Both of these are intro to econ toy models assuming homogeneous goods and perfect information. Because of this, they are rarely useful in real world pricing.
Giskard
CC BY-SA 4.0
2021-05-13T02:10:18.760Z
Can you please suggest some good model that be useful in real world pricing.@Giskard
sujithDas
CC BY-SA 4.0
2021-05-13T06:18:48.710Z
Unfortunately, I cannot. I recommend editing your question / posting a new question, because the focus has shifted significantly. Hopefully someone else will give come along to give you some insight.
Giskard
<microeconomics><self-study><price><competition><data>
Better Model for Dynamic pricing - Stackelberg model or Bertrand model
sujithDas
# Better Model for Dynamic pricing - Stackelberg model or Bertrand model

(Asked by: username_0 on 2021-05-12)

Objective - I am building a dynamic pricing tool for airline tickets which will consider the competitor prices. Taking competitor price as reference, this tool will price the ticket. Also instead of price simultaneously need to follow the lead player in the market and price the ticket.

In the research found out two models

> 1. Bertrand Model 2) Stackelberg Model

As per my knowledge Bertrand model is competing on prices and stackelberg competing with quantities.

As airline is a industry which has capacity constraints (i.e can't compete on quantities), I have mainly two queries related to stackelberg model

> 1). can I use stackelberg(leader-follower) model/concept,
> if need to compete with prices instead of quantities.
>
> 2). Can stackelberg be used with multiple leaders (more than 2) ?
>
> 3). Or Is there any combination of both models for example something called
> bertrand-stackelberg

Can anyone help with insights. Thanks in advance

**Tags:** microeconomics, self-study, price, competition, data
> **Comments:**
> **username_1**: Both of these are intro to econ toy models assuming homogeneous goods and perfect information. Because of this, they are rarely useful in real world pricing.  
> **username_0**: Can you please suggest some good model that be useful in real world pricing.@Giskard  
> **username_1**: Unfortunately, I cannot. I recommend editing your question / posting a new question, because the focus has shifted significantly. Hopefully someone else will give come along to give you some insight.  

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## 0 answers

