Consumers possess limited capacity to process technical information concerning the characteristics of products. As a result, two forms of regulation (e.g., by the FDA or FTC) sometimes appear in the form of requirements for more understandable information about the product or restrictions on the...

This paper deals with the problem of pricing in decreasing cost industries that exhibit the peak load phenomenon. Because of decreasing costs, welfare maximizing marginal cost pricing results in deficits. Consequently, other pricing methods such as two-part tariffs are necessary, if deficits are...