The paper studies how second degree price discrimination can be implemented in a duopoly with differentiated products. Two firms serve consumers having heterogeneous willingness to pay for the good, willingness to pay being private knowledge. Consumers choose from a menu of tariffs and are subsequently billed according to the chosen tariff. Although product differentiation enables the firms to implement price discrimination, it is shown that competition have important effect on the tariff structure.
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Publisher Info
Paper provided by Norwegian School of Economics and Business Administration- in its series Papers with number
3/2000.
Length: 25 pages Date of creation: 2000 Date of revision: Handle: RePEc:fth:norgee:3/2000
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