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Protecting vulnerable consumers in "switching markets"

Author

Listed:
  • Walter Beckert

    (Institute for Fiscal Studies and Birkbeck, University of London)

  • Paolo Siciliani

    (Institute for Fiscal Studies)

Abstract

This paper studies regulatory policy interventions aimed at protecting vulnerable consumers who are disengaged and thus exposed to exploitation. We model heterogeneous consumer switching costs alongside asymmetric market shares. This setting encompasses many markets in which established rms are challenged by new entrants. We identify circumstances under which such interventions can be counterproductive, both with regard to the stated consumer protection objective and the complementary aim to promote competition.

Suggested Citation

  • Walter Beckert & Paolo Siciliani, 2018. "Protecting vulnerable consumers in "switching markets"," IFS Working Papers W18/23, Institute for Fiscal Studies.
    • Handle: RePEc:ifs:ifsewp:18/23
    as

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    File URL: https://www.ifs.org.uk/uploads/publications/wps/WP201823.pdf
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    References listed on IDEAS

    as
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    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    switching costs; price discrimination; uniform pricing; most-favoured customer clauses; price regulation; competition;
    All these keywords.

    JEL classification:

    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • D4 - Microeconomics - - Market Structure, Pricing, and Design

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