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Predicting Auction Price of Vehicle License Plate with Deep Recurrent Neural Network

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  • Vinci Chow

Abstract

In Chinese societies, superstition is of paramount importance, and vehicle license plates with desirable numbers can fetch very high prices in auctions. Unlike other valuable items, license plates are not allocated an estimated price before auction. I propose that the task of predicting plate prices can be viewed as a natural language processing (NLP) task, as the value depends on the meaning of each individual character on the plate and its semantics. I construct a deep recurrent neural network (RNN) to predict the prices of vehicle license plates in Hong Kong, based on the characters on a plate. I demonstrate the importance of having a deep network and of retraining. Evaluated on 13 years of historical auction prices, the deep RNN's predictions can explain over 80 percent of price variations, outperforming previous models by a significant margin. I also demonstrate how the model can be extended to become a search engine for plates and to provide estimates of the expected price distribution.

Suggested Citation

  • Vinci Chow, 2017. "Predicting Auction Price of Vehicle License Plate with Deep Recurrent Neural Network," Papers 1701.08711, arXiv.org, revised Oct 2019.
    • Handle: RePEc:arx:papers:1701.08711
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