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Unpriced Quality

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  • Pascal Courty

Abstract

A monopolist deliberately charges the same price for differentiated products when high quality products are more likely to be allocated to low type consumers under uniform pricing. The argument can explain the use of ‘unpriced quality’ for concert tickets, sport events, and in many other situations.

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Bibliographic Info

Paper provided by European University Institute in its series Economics Working Papers with number ECO2009/16.

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Date of creation: 2009
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Handle: RePEc:eui:euiwps:eco2009/16

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Related research

Keywords: Price discrimination; second degree price discrimination; queuing; rationing;

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  1. Marie Connolly & Alan B. Krueger, 2005. "Rockonomics: The Economics of Popular Music," NBER Working Papers 11282, National Bureau of Economic Research, Inc.
  2. Armstrong, Mark, 2006. "Price discrimination," MPRA Paper 4693, University Library of Munich, Germany.
  3. Mussa, Michael & Rosen, Sherwin, 1978. "Monopoly and product quality," Journal of Economic Theory, Elsevier, vol. 18(2), pages 301-317, August.
  4. Sofronis K. Clerides, 2004. "Price Discrimination with Differentiated Products: Definition and Identification," Economic Inquiry, Western Economic Association International, vol. 42(3), pages 402-412, July.
  5. Stole, Lars A., 2007. "Price Discrimination and Competition," Handbook of Industrial Organization, Elsevier.
  6. Gilbert, Richard & Klemperer, Paul, 1993. "An Equilibrium Theory of Rationing," CEPR Discussion Papers 805, C.E.P.R. Discussion Papers.
  7. Phillip Leslie & Alan Sorensen, 2009. "The Welfare Effects of Ticket Resale," NBER Working Papers 15476, National Bureau of Economic Research, Inc.
  8. Holt, Charles A, Jr & Sherman, Roger, 1982. "Waiting-Line Auctions," Journal of Political Economy, University of Chicago Press, vol. 90(2), pages 280-94, April.
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