Title: Optimal Duration-Based Pricing Under Congestion
Speaker: Jianfu Wang (City University of Hong Kong)
Time: 10:00 (Wednesday), October 14th, 2026
Venue: Room 1008, Mingde Business Building (Zhongguancun Campus)
Language: Chinese/English
ABSTRACT:
In services such as ride-hailing, delivery, and cloud computing, duration shapes both a customer’s willingness to pay and the congestion imposed on others. Using a queueing model, this talk examines how a service provider should price jobs of different lengths. When customer valuation scales proportionally with duration, the optimal price always rises with duration. When valuation combines a base value with a duration-dependent component, the price schedule can shift from decreasing to U-shaped to increasing as market demand grows. Longer jobs may bring in more revenue, but they also increase waiting times; beyond a point, the provider may limit the longest jobs. The analysis further compares the firm’s decisions with the socially optimal outcome and discusses how duration-dependent subsidies can close the gap. These results help explain pricing patterns such as long-trip discounts in taxi markets and tiered delivery surcharges.
SHORT BIOGRAPHY:
Jianfu (Jeff) Wang is an Associate Professor of Operations Management in the Department of Decision Analytics and Operations at the City University of Hong Kong. He holds a Ph.D. in Operations Management from the Rotman School of Management at the University of Toronto. His research centers on queueing theory, with applications in platform operations, information economics, healthcare systems, and revenue management. His work is featured in leading academic journals, including Management Science, Operations Research, and Manufacturing & Service Operations Management.
His research was named a finalist for the 2025 Management Science Best Paper Award in Operations Management. In 2022, Jeff earned the M&SOM Meritorious Service Award. His past accolades include awards for teaching excellence and research excellence from Nanyang Technological University. He serves as an Associate Editor for the journal Service Science.