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This paper demonstrates that the standard conclusions regarding the comparison of Cournot and Bertrand competition are … Cournot competition yields higher output, lower wholesale prices, lower final prices, higher consumers' surplus, and higher … total welfare than Bertrand competition. …
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Letters, 124: 122-126) show that in a vertically related market Cournot competition yields higher social welfare compared to … Bertrand competition if the upstream firm subsidises the quantity setting downstream firm's production via negative wholesale …
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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...
Persistent link: https://www.econbiz.de/10014078592
This paper uses a simple diagram to compare two pricing strategies: price-quantity packages, and a two-part tariff from the monopoly and from the welfare points of view. It is shown that in the two-type consumer case when the monopoly is concerned, the price-quantity packages strategy dominates...
Persistent link: https://www.econbiz.de/10014058904
By focusing on the two intercepts — the price and quantity intercepts — of inverse linear demands, this note shows that compared to uniform pricing, third-degree price discrimination can be neutral. When all price intercepts of sub-markets' inverse demands are the same, not only will all the...
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This pedagogical note discusses the differences between second and third-degree price discrimination. The comparison uses four important factors, namely, market segmentation, information about consumers, profit maximization and social welfare. The comparison shows that while market segmentation...
Persistent link: https://www.econbiz.de/10012733550