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Smartphone Based Automatic Price Determination of Agricultural Products

Md Rakib Hassan
Department of Computer Science and Mathematics, Faculty of Agricultural Engineering and Technology, Bangladesh Agricultural University, Mymensingh 2202, Bangladesh

Abstract/ Executive Summary:

Smartphones are increasingly becoming an integral part of our life. We carry it every time with us and use it to do various tasks including browsing internet, emails, social websites and others. We also perform online shopping with our smartphones. In this paper, a new automatic price determination algorithm for agricultural products is proposed that can be used by both the sellers and buyers using their smartphones. The buyers will place their demands for their required agricultural products to the sellers of a particular market and the sellers will also place their supplies. The algorithm will then automatically calculate the market equilibrium price using learning rate based iterative distributed price determination algorithm. As a result, both the sellers and buyers can save their time in finding the suitable prices of the agricultural products. The performance results show that the algorithm is stable and reaches the market equilibrium price within a few milliseconds.

Keywords: Agricultural products, Market equilibrium, Price sellers, Buyers

Location: Department of Computer Science and Mathematics, Faculty of Agricultural Engineering and Technology, Bangladesh Agricultural University, Mymensingh 2202, Bangladesh

Start Date:

End Date:

Program Area: Socio-economic and Policy

Non-commodity: Income generation

Objectives:

To determine the Smartphone Based Automatic Price Determination of Agricultural Products

Methodology:

Different hardware and software tools have been used to model the agricultural market scenario with multiple sellers and buyers. The used hardware device was a laptop with Intel core i7 processor, 8 GB RAM and Windows 8.1 operating system. The software tools include emulated android devices running different android operating systems, Matlab (Attaway, 2013) and Java programming language (Schildt, 2014). Sellers may or may not have smartphones. There is also a central coordinator that collects all the supplies from the sellers and all the demands from the buyers using online and offline forms. The central coordinator is a server where the distributed market equilibrium algorithm calculates the price of the agricultural products. Each of the sellers will have different products to sell in the market. The buyers will have different demands for different products. Market equilibrium price will be calculated for each of the products based on the supplies from the sellers and demands from the buyers. To model the supply and demand of an agricultural product, a utility function (Pindyck & Rubinfeld, 2009), (Niyato and Hossain, 2010) is used which defines the satisfaction of the buyers. The more the utility for a product, the higher the demand from a buyer. The more the utility for a product, the higher the demand from a buyer. Based on the basic supply and demand theory of microeconomics (Pfitzner, 1993). Utility or satisfaction of the buyer will initially increase and then saturate for higher amount of the agricultural product and for lower price offered. The seller and the buyer may have limited information about each other’s supply and demand, the market equilibrium can be obtained iteratively through the central coordinator. In the initial stage, the buyer will observe the advertised price from the seller for a particular product and submit its demand through the central coordinator. The seller submits the price to the coordinator which then computes the required product amount using the demand function of (2) and the coordinator then send the price to the seller. The central coordinator thus updates the price rate that weighs the difference between demand and supply. The higher the value is given to the difference than the previous price. A positive value of the difference implies excessive demand from the buyer and negative value indicates excessive supply. Thus the price will be gradually adjusted based on the supply and demand. This iteration will continue until the price difference becomes less than a predefined threshold value.

Source of Information: Res. Agric. Livest. Fish. Vol. 4, No. 2, August 2017: 69-75

Article Link (Online Journal):

Funding Source:

Budget:

Total Budget (Tk.) :

Achievement/Findings:

In this paper, a new distributed price determination algorithm for agricultural products is proposed where the buyers can buy agricultural products from the sellers. This algorithm calculates the market equilibrium price based on the supply and demand of the sellers and buyers, respectively. Extensive analyses have been carried out to analyze the performance of the proposed model. The results show that the proposed method easily converges to the equilibrium solution within a very short time.

Knowledge Management: Journal