This paper presents a model of second-degree price discrimination by a monopolistic seller who offers a menu of price-quantity pair contracts to consumers located in a social network. Network effects are local as consumers' private valuations are increasing in their friends' adoption decisions....

I present a new model of optimal dynamic pricing and diffusion of a network good sold by a monopolist. The good in this model is a social network good in that each consumer’s value of the good within a social network increases as more of her neighbors use the good. In each period, the...

This paper studies the pricing incentives of a monopolist constrained by a revenue cap endogenously determined by her costs in a so-called base year. Such regulation is employed, among others, to govern electricity distribution operators in Germany. We show that the revenue cap may incentivize...

When a durable good of uncertain quality is introduced to the market, some consumers strategically delay their buying to the next period with the hope of learning the unknown quality. We analyze the monopolist's pricing strategies when consumers have strategic delay incentives. We show when the...

When an improvable durable good (such as packaged software) saturates the market, the seller could be tempted to release new versions too frequently, hurting her profit. A novel contractual device, which we term as a Free New Version Rights warranty (Free NVR warranty), can help the seller...