Price Discrimination As Portfolio Diversification
AbstractA seller seeking to sell an indivisible object can post (possibly different) prices to each of n buyers. Buyers' valuations are private information and drawn independently from the same distribution. If the seller can choose who to sell to in the event there are several willing buyers, her optimal strategy is to post different prices to different buyers. For some distributions, price discrimination may be profitable even if excess demand must be resolved through a uniform lottery.
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Bibliographic InfoArticle provided by AccessEcon in its journal Economics Bulletin.
Volume (Year): 4 (2008)
Issue (Month): 5 ()
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Find related papers by JEL classification:
- D4 - Microeconomics - - Market Structure and Pricing
- D8 - Microeconomics - - Information, Knowledge, and Uncertainty
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"Bargains and Ripoffs: A Model of Monopolistically Competitive Price Dispersion,"
Review of Economic Studies,
Wiley Blackwell, vol. 44(3), pages 493-510, October.
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