dynamic pricing

Flexible pricing model where the value of goods and services is determined on an individual basis, usually by mutual negotiation. The Internet is expected to be a proving ground for the dynamic pricing model. Researchers at technology institutes, such as Massachusetts Institute of Technology Media Labs, are working on intelligent software agents that will be able to carry out transactions remotely over the Internet. The agents will interact with the vendor's software, which continually monitors and alters the price of goods and services according to external circumstances. In theory this is a more efficient pricing model than the traditional fixed pricing model in which power lies solely with the vendor.