Showing 1 - 10 of 17
We revisit the effects of switching costs on dynamic competition. We consider stationary Markovian strategies, with market shares being the state variable, and characterize a relatively simple Markov Perfect pricing equilibrium at which there is switching by some consumers at all times. For the...
Persistent link: https://www.econbiz.de/10011189508
This paper examines the welfare implication of banning price discrimination in the intermediate goods market in which a monopolistic supplier contracts with asymmetric downstream retailers. We demonstrate that the supplier has a strong incentive to manipulate the interdependent demand structure...
Persistent link: https://www.econbiz.de/10011208462
We re-examine the view that a ban on price discrimination in input markets is particularly desirable in the presence of buyer power. This argument crucially depends on an inverse relationship between downstream firms’ profits and the uniform input price. Assuming different input efficiencies...
Persistent link: https://www.econbiz.de/10011189534
We consider a two-period model in which duopolists sell experience goods and practice behavior-based price discrimination (BBPD). We give general conditions for when firms should offer a lower price to existing customers (‘pay-to-stay’) or to new customers (‘pay-to-switch’). We also...
Persistent link: https://www.econbiz.de/10010603111
We estimate consumer surplus gains and losses from concert ticket price discrimination. Fans purchasing low-priced tickets enjoy a surplus gain of about $9.26 per ticket while high-priced ticket buyers suffer a loss of about $17.63 per ticket.
Persistent link: https://www.econbiz.de/10010603132
The two central pricing rules contained in most antitrust laws are prohibitions of below-cost pricing and prohibitions of discriminatory pricing. This article shows that the rule against discriminatory pricing may actually induce firms to charge exclusionary below-cost prices, even in the...
Persistent link: https://www.econbiz.de/10010594082
This note investigates the effects of a large horizontal merger on the shape of the 1-to-12 h price menus offered by parking garages in Paris. The merger caused low-end prices to increase proportionally more than high-end prices. This results in larger discounts on longer hours and hence in more...
Persistent link: https://www.econbiz.de/10010594159
We examine the average equilibrium price when quantity setting oligopolies price discriminate. It is known that for the price discrimination extension of Cournot competition the average price is independent of the extent of price discrimination whenever the demand is linear. We show that this...
Persistent link: https://www.econbiz.de/10010594161
Payment networks typically differentiate interchange fees across different merchant sectors. This paper shows that it is generally efficient for a regulator to leave the decision on the structure of interchange fees to payment networks.
Persistent link: https://www.econbiz.de/10010572223
This letter addresses the second-degree price discrimination issue when a monopolized product is tied with environmental quality. The monopolist may degrade environmental quality too much when marginal valuations of environmental quality and the good itself are positively related across consumers.
Persistent link: https://www.econbiz.de/10010576431