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Eliciting demand information through cheap talk: An argument in favor of a ban on price discrimination

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  • Frisell, Lars
  • Lagerlöf, Johan N.M.

Abstract

A uniform pricing rule may enable the communication of demand information from buyer to seller in situations where this would not have been possible if the seller could price discriminate. Importantly, such a rule can benefit both buyer and seller.

Suggested Citation

  • Frisell, Lars & Lagerlöf, Johan N.M., 2008. "Eliciting demand information through cheap talk: An argument in favor of a ban on price discrimination," Economics Letters, Elsevier, vol. 99(3), pages 421-424, June.
    • Handle: RePEc:eee:ecolet:v:99:y:2008:i:3:p:421-424
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    References listed on IDEAS

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    1. Farrell, Joseph & Gibbons, Robert, 1995. "Cheap Talk about Specific Investments," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 11(2), pages 313-334, October.
    2. Schmalensee, Richard, 1981. "Output and Welfare Implications of Monopolistic Third-Degree Price Discrimination," American Economic Review, American Economic Association, vol. 71(1), pages 242-247, March.
    3. Varian, Hal R, 1985. "Price Discrimination and Social Welfare," American Economic Review, American Economic Association, vol. 75(4), pages 870-875, September.
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