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Price discrimination with a resource constraint

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  • Dana Jr., James D.
  • Yahalom, Tomer

Abstract

Introducing an aggregate resource constraint into Mussa and Rosen's [Mussa, M., Rosen, S., 1978. Monopoly and product quality. Journal of Economic Theory 18 (2), 301-317] model of monopoly price discrimination induces an upwards distortion in product quality for high valuation consumers because the standard downward distortions in product quality for other consumers relax the resource constraint.

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Bibliographic Info

Article provided by Elsevier in its journal Economics Letters.

Volume (Year): 100 (2008)
Issue (Month): 3 (September)
Pages: 330-332

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Handle: RePEc:eee:ecolet:v:100:y:2008:i:3:p:330-332

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Web page: http://www.elsevier.com/locate/ecolet

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  1. Eric T. Anderson & James D. Dana, Jr., 2009. "When Is Price Discrimination Profitable?," Management Science, INFORMS, vol. 55(6), pages 980-989, June.
  2. Mussa, Michael & Rosen, Sherwin, 1978. "Monopoly and product quality," Journal of Economic Theory, Elsevier, vol. 18(2), pages 301-317, August.
  3. Stokey, Nancy L, 1979. "Intertemporal Price Discrimination," The Quarterly Journal of Economics, MIT Press, vol. 93(3), pages 355-71, August.
  4. Salant, Stephen W, 1989. "When Is Inducing Self-selection Suboptimal for a Monopolist?," The Quarterly Journal of Economics, MIT Press, vol. 104(2), pages 391-97, May.
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