FairPlay: A Multi-Sided Fair Dynamic Pricing Policy for Hotels

Abstract

In recent years, popular touristic destinations face overtourism. Local communities suffer from its consequences in several ways. Among others, overpricing and profiteering harms local societies and economies deeply. In this paper we focus on the problem of determining fair hotel room prices. Specifically, we put forward a dynamic pricing policy where the price of a room depends not only on the demand of the hotel it belongs to but also on the demand of: (i) similar rooms in the area and (ii) their hotels. To this purpose, we model our setting as a cooperative game and exploit an appropriate game theoretic solution concept that promotes fairness both on the customers' and the providers' side. Our simulation results involving price adjustments across real-world hotels datasets, confirm that ours is a fair dynamic pricing policy, avoiding both over- and under-pricing hotel rooms.