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Is Perfect Price Discrimination Really Efficient? An Analysis of Free Entry Author info | Abstract | Publisher info | Download info | Related research | Statistics V. Bhaskar ()
Ted To ()
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We analyze models of product differentiation with perfect price discrimination and free entry. With a fixed number of firms, and in the absence of coordination failures, perfect price discrimination provides incentives for firms to choose product characteristics in a socially optimal way. However, with free entry, the number of firms is always excessive. Our results apply to a large class of models of product differentiation. They also apply to models of common agency or lobbying with free entry and imply that one has excessive entry into the ranks of the principals.
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Paper provided by University of Essex, Department of Economics in its series Economics Discussion Papers with number
537.
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Date of creation: 09 Apr 2002Date of revision:
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repec:bep:thetop:v:7:y:2007:i:1:p:1276-1276 is not listed on IDEAS
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