Over the past decade, an increasing number of firms have delegated pricing decisions to algorithms in consumer markets such as travel, entertainment, and retail; business markets such as digital advertising; and platform markets such as ride-sharing. This trend, driven primarily by the increased...

Researchers and business thought leaders have emphasized that, towards maximizing the lifetime value of customers, firms must manage customer relationships for the long term. In contrast to this recommendation, we demonstrate that firm profits in competitive environments are maximized when...