Arbeitspapier

Third-degree price discrimination in an oligopolistic market

In this paper a discrete choice model is suggested which generates unambiguously lower prices, if oligopolists discriminate by price. In a setting of two groups of consumers and two firms this is due to a different ranking of the elasticity of demand of the two groups by the two firms. Here, this ranking results from switching costs. It is argued that firms can prevent price discrimination which lowers their profits, if firms are symmetric. However, with asymmetric firms price discrimination cannot always be prevented by simple threats to pay back in kind. In this case there is an incentive to use price discrimination and it enhances welfare.

Sprache
Englisch

Erschienen in
Series: W.E.P. - Würzburg Economic Papers ; No. 6

Klassifikation
Wirtschaft
Thema
Preisdifferenzierung
Oligopol
Spieltheorie
Theorie

Ereignis
Geistige Schöpfung
(wer)
Schulz, Norbert
Ereignis
Veröffentlichung
(wer)
University of Würzburg, Department of Economics
(wo)
Würzburg
(wann)
1999

Handle
Letzte Aktualisierung
10.03.2025, 11:45 MEZ

Datenpartner

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Objekttyp

  • Arbeitspapier

Beteiligte

  • Schulz, Norbert
  • University of Würzburg, Department of Economics

Entstanden

  • 1999

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