Author: Francis K. Cheung
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
Book Description
This paper analyses the output effect of price discrimination in a Cournot oligopoly where firms have different costs. Criteria which are based on the demand curves but not on the industry cost structure are developed to determine the direction of output change. Such criteria may provide an analytical basis for assessing regulatory cases and developing empirical propositions in testing the social impact of oligopolistic price discrimination.
The Output Effect Under Oligopolistic Third Degree Price Discrimination
Author: Francis K. Cheung
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
Book Description
This paper analyses the output effect of price discrimination in a Cournot oligopoly where firms have different costs. Criteria which are based on the demand curves but not on the industry cost structure are developed to determine the direction of output change. Such criteria may provide an analytical basis for assessing regulatory cases and developing empirical propositions in testing the social impact of oligopolistic price discrimination.
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
Book Description
This paper analyses the output effect of price discrimination in a Cournot oligopoly where firms have different costs. Criteria which are based on the demand curves but not on the industry cost structure are developed to determine the direction of output change. Such criteria may provide an analytical basis for assessing regulatory cases and developing empirical propositions in testing the social impact of oligopolistic price discrimination.
Recent Advances in the Theory of Third-Degree Price Discrimination
Author: Takanori Adachi
Publisher: Springer Nature
ISBN: 981993205X
Category : Business & Economics
Languages : en
Pages : 85
Book Description
This book provides an updated overview of the recent progress in the theoretical study of third-degree price discrimination. It is a marketing tactic and is said to be present if the unit price is different across different groups of buyers. Its welfare evaluation is often difficult because it entails two countervailing effects: on one hand, it exploits surplus from consumers who have high willingness-to-pay, but on the other hand, it generates gains from trade from consumers who otherwise would not purchase the good. Recognizing this difficulty, we provide new insights on evaluation of third-degree price discrimination in consideration of network effects and vertical product differentiation. Our analysis is particularly useful for the industries related to information and communication technologies (ICT) because these two elements characterize them. Furthermore, we also study the welfare effects of third-degree price discrimination under imperfect competition other than monopoly. At first, it seems that it may complicate the analysis under monopoly. However, we argue that the main thrusts of analysis under monopoly carry over to the case of oligopoly. We also take into account behavioral aspects and their implications for studying third-degree price discrimination. Overall, this book is designed to provide implications for contemporary management and policy issues by advancing theoretical issues in industrial organization.
Publisher: Springer Nature
ISBN: 981993205X
Category : Business & Economics
Languages : en
Pages : 85
Book Description
This book provides an updated overview of the recent progress in the theoretical study of third-degree price discrimination. It is a marketing tactic and is said to be present if the unit price is different across different groups of buyers. Its welfare evaluation is often difficult because it entails two countervailing effects: on one hand, it exploits surplus from consumers who have high willingness-to-pay, but on the other hand, it generates gains from trade from consumers who otherwise would not purchase the good. Recognizing this difficulty, we provide new insights on evaluation of third-degree price discrimination in consideration of network effects and vertical product differentiation. Our analysis is particularly useful for the industries related to information and communication technologies (ICT) because these two elements characterize them. Furthermore, we also study the welfare effects of third-degree price discrimination under imperfect competition other than monopoly. At first, it seems that it may complicate the analysis under monopoly. However, we argue that the main thrusts of analysis under monopoly carry over to the case of oligopoly. We also take into account behavioral aspects and their implications for studying third-degree price discrimination. Overall, this book is designed to provide implications for contemporary management and policy issues by advancing theoretical issues in industrial organization.
On Third-Degree Price Discrimination in Oligopoly
Author: Krishnendu Ghosh Dastidar
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
Book Description
In this paper we analyse the effects of third-degree price discrimination on output, profit and welfare in a symmetric cost duopoly. We provide sufficient conditions for output, profit and welfare to be higher (or lower) under third-degree price discrimination in a duopoly, compared with a uniform price regime. Comparing our findings with the traditional results on monopoly price discrimination, we show that the output and profit effects under duopoly price discrimination are very different from those under the monopoly case. However, the welfare effects are very similar.
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
Book Description
In this paper we analyse the effects of third-degree price discrimination on output, profit and welfare in a symmetric cost duopoly. We provide sufficient conditions for output, profit and welfare to be higher (or lower) under third-degree price discrimination in a duopoly, compared with a uniform price regime. Comparing our findings with the traditional results on monopoly price discrimination, we show that the output and profit effects under duopoly price discrimination are very different from those under the monopoly case. However, the welfare effects are very similar.
Third-degree Price Discrimination in Oligopoly when Markets are Covered
Author: Markus Dertwinkel-Kalt
Publisher:
ISBN: 9783863043353
Category :
Languages : en
Pages :
Book Description
We analyze oligopolistic third-degree price discrimination relative to uniform pricing, when markets are always covered. Pricing equilibria are critically determined by supply-side features such as the number of firms and their marginal cost differences. It follows that each firm's Lerner index under uniform pricing is equal to the weighted harmonic mean of the firm's relative margins under discriminatory pricing. Uniform pricing then decreases average prices and raises consumer surplus. We provide an intriguingly simple approach to calculate the consumer surplus gain from uniform pricing only based on market data of the discriminatory equilibrium (prices and quantities).
Publisher:
ISBN: 9783863043353
Category :
Languages : en
Pages :
Book Description
We analyze oligopolistic third-degree price discrimination relative to uniform pricing, when markets are always covered. Pricing equilibria are critically determined by supply-side features such as the number of firms and their marginal cost differences. It follows that each firm's Lerner index under uniform pricing is equal to the weighted harmonic mean of the firm's relative margins under discriminatory pricing. Uniform pricing then decreases average prices and raises consumer surplus. We provide an intriguingly simple approach to calculate the consumer surplus gain from uniform pricing only based on market data of the discriminatory equilibrium (prices and quantities).
A General Analysis of the Output Effect Under Third-degree Price Discrimination
Author: Jun-ji Shih
Publisher:
ISBN:
Category : Price discrimination
Languages : en
Pages : 13
Book Description
Publisher:
ISBN:
Category : Price discrimination
Languages : en
Pages : 13
Book Description
Third-Degree Price Discrimination in Oligopoly
Author: Kenneth S. Corts
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
Book Description
Price discrimination by imperfectly competitive firms may intensify competition, leading to lower prices for all consumers; the trade-off of consumer groups' welfare that is characteristic of monopolistic discrimination need not arise. This escalation of competition may make firms worse off, and as a result firms may wish to avoid the discriminatory outcome. Under conditions similar to those in which unambiguous price and welfare effects may arise, unilateral commitments not to price discriminate--including the adoption of everyday low pricing or no-haggle policies--may raise firm profits by softening price competition.
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
Book Description
Price discrimination by imperfectly competitive firms may intensify competition, leading to lower prices for all consumers; the trade-off of consumer groups' welfare that is characteristic of monopolistic discrimination need not arise. This escalation of competition may make firms worse off, and as a result firms may wish to avoid the discriminatory outcome. Under conditions similar to those in which unambiguous price and welfare effects may arise, unilateral commitments not to price discriminate--including the adoption of everyday low pricing or no-haggle policies--may raise firm profits by softening price competition.
The Effects of Imperfect Price Discrimination in a Bertrand Oligopoly
Author: Thomas Joseph Holmes
Publisher:
ISBN:
Category :
Languages : en
Pages : 60
Book Description
Publisher:
ISBN:
Category :
Languages : en
Pages : 60
Book Description
Teaching Third-Degree Price Discrimination by a Monopolist With Linear Demands
Author: Manuel Salas-Velasco
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
Book Description
This paper uses both a geometrical and mathematical analysis to explain monopolistic third-degree price discrimination, and it also shows how price discrimination affects society. A frequent policy question in the price discrimination literature is whether to allow third-degree price discrimination or to enforce uniform pricing. A key feature to understanding this issue in the context of imperfectly competitive markets is the impact of price discrimination on output. The article shows that a monopoly facing downward sloping linear demands, and constant marginal costs, will obtain higher profits under price discrimination than under a single-price strategy, but price discrimination lowers welfare if total output does not change. When price discrimination causes total output to increase, then this practice will have a beneficial effect on overall welfare.
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
Book Description
This paper uses both a geometrical and mathematical analysis to explain monopolistic third-degree price discrimination, and it also shows how price discrimination affects society. A frequent policy question in the price discrimination literature is whether to allow third-degree price discrimination or to enforce uniform pricing. A key feature to understanding this issue in the context of imperfectly competitive markets is the impact of price discrimination on output. The article shows that a monopoly facing downward sloping linear demands, and constant marginal costs, will obtain higher profits under price discrimination than under a single-price strategy, but price discrimination lowers welfare if total output does not change. When price discrimination causes total output to increase, then this practice will have a beneficial effect on overall welfare.
Handbook of Industrial Organization
Author: Richard Schmalensee
Publisher: North Holland
ISBN:
Category : Business & Economics
Languages : en
Pages : 1002
Book Description
Determinants of firm and market organization; Analysis of market behavior; Empirical methods and results; International issues and comparision; government intervention in the Marketplace.
Publisher: North Holland
ISBN:
Category : Business & Economics
Languages : en
Pages : 1002
Book Description
Determinants of firm and market organization; Analysis of market behavior; Empirical methods and results; International issues and comparision; government intervention in the Marketplace.
Market Structure and Behavior
Author: Martin Shubik
Publisher:
ISBN: 9780674433397
Category :
Languages : en
Pages : 272
Book Description
Publisher:
ISBN: 9780674433397
Category :
Languages : en
Pages : 272
Book Description