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Supplying Information to Facilitate Price Discrimination

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Author Info
Lewis, Tracy R
Sappington, David E M

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Abstract

The authors examine the incentive of a seller to allow potential buyers to acquire private information about their tastes for the seller's product. Improved private information for buyers enables the seller to segment the market and charge higher prices to high-value buyers. However, improved information can also provide rents to buyers. In a variety of settings, this tradeoff is optimally resolved at one of two extremes: either buyers are supplied with the best available knowledge of their tastes or no information is supplied by the seller. Copyright 1994 by Economics Department of the University of Pennsylvania and the Osaka University Institute of Social and Economic Research Association.

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File URL: http://links.jstor.org/sici?sici=0020-6598%28199405%2935%3A2%3C309%3ASITFPD%3E2.0.CO%3B2-R&origin=repec
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Publisher Info
Article provided by Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association in its journal International Economic Review.

Volume (Year): 35 (1994)
Issue (Month): 2 (May)
Pages: 309-27
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Handle: RePEc:ier:iecrev:v:35:y:1994:i:2:p:309-27

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  1. Alexander Saak, 2007. "A note on the value of public information in monopoly," Economic Theory, Springer, vol. 33(2), pages 369-379, November. [Downloadable!] (restricted)
  2. Astrid Meck, 2001. "Shopbots, Powershopping, Powersales: New Forms of Intermediation in E-Commerce - An Overview -," Discussion Paper Series 203, Universitaet Augsburg, Institute for Economics. [Downloadable!]
  3. repec:bep:eapcon:v:4:y:2005:i:1:p:1434-1434 is not listed on IDEAS
  4. Heski Bar-Isaac & Guillermo Caruana & Vicente Cunat, 2008. "Information Gathering and Marketing," Working Papers 08-17, New York University, Leonard N. Stern School of Business, Department of Economics. [Downloadable!]
  5. Alexandre Gaudeul, 2004. "Shareware competition: Selling an experience," Game Theory and Information 0409008, EconWPA. [Downloadable!]
  6. Juan J. Ganuza, 1998. "Competition and Cost Overruns. Optimal Misspecification of Procurement Contracts," Economics Working Papers 471, Department of Economics and Business, Universitat Pompeu Fabra, revised Mar 2002. [Downloadable!]
  7. Eugenio J. Miravete, 1995. "Screening Consumers through Alternative Pricing Mechanisms," Discussion Papers 1145, Northwestern University, Center for Mathematical Studies in Economics and Management Science. [Downloadable!]
  8. Justin P. Johnson & David P. Myatt, 2006. "On the Simple Economics of Advertising, Marketing, and Product Design," American Economic Review, American Economic Association, vol. 96(3), pages 756-784, June. [Downloadable!]
    Other versions:
  9. Edward S. Prescott & Robert M. Townsend, 2003. "Mechanism design and assignment models," Working Paper 03-09, Federal Reserve Bank of Richmond. [Downloadable!]
  10. Marco Ottaviani, 2000. "The Value of Public Information in Monopoly," Econometric Society World Congress 2000 Contributed Papers 1479, Econometric Society. [Downloadable!]
    Other versions:
  11. Steven A. Matthews & Nicola Persico, 2005. "Information Acquisition and the Excess Refund Puzzle," PIER Working Paper Archive 05-015, Penn Institute for Economic Research, Department of Economics, University of Pennsylvania. [Downloadable!]
  12. Juan José Ganuza & José S. Penalva, 2006. "On Information and Competition in Private Value Auctions," Economics Working Papers 937, Department of Economics and Business, Universitat Pompeu Fabra, revised Jul 2006. [Downloadable!]
  13. Steven A. Matthews & Nicola Persico, 2007. "Information Acquisition and Refunds for Returns," PIER Working Paper Archive 07-021, Penn Institute for Economic Research, Department of Economics, University of Pennsylvania. [Downloadable!]
    Other versions:
  14. Peter Eso & Balazs Szentes, 2003. "The One Who Controls the Information Appropriates Its Rents," Discussion Papers 1369, Northwestern University, Center for Mathematical Studies in Economics and Management Science. [Downloadable!]
  15. Miravete, Eugenio J, 2000. "Estimating Demand for Local Telephone Service with Asymmetric Information and Optional Calling Plans," CEPR Discussion Papers 2635, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
  16. Simon Board, 2009. "Revealing information in auctions: the allocation effect," Economic Theory, Springer, vol. 38(1), pages 125-135, January. [Downloadable!] (restricted)
  17. Bose, Subir & Orosel, Gerhard O & Ottaviani, Marco & Vesterlund, Lise, 2005. "Dynamic Monopoly Pricing and Herding," CEPR Discussion Papers 5003, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
  18. Marco LiCalzi, 2005. "A sufficient condition for all-or-nothing information supply in price discrimination," Game Theory and Information 0510005, EconWPA. [Downloadable!]
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