The welfare effects of third-degree price discrimination with non-linear demand functions
Abstract
The welfare effects of third-degree price discrimination are analyzed when demand in one market is an additively shifted version of demand in the other market and both markets are served with uniform pricing. Social welfare is lower with discrimination if the slope of demand is log-concave or the convexity of demand is non-decreasing in the price. The demand functions commonly used in models of imperfect competition satisfy at least one of these sufficient conditions.Download Info
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Paper provided by University of Oxford, Department of Economics in its series Economics Series Working Papers with number 364.Length:
Date of creation: 01 Oct 2007
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Handle: RePEc:oxf:wpaper:364
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Related research
Keywords: Price Discrimination; Monopoly;Find related papers by JEL classification:
- D42 - Microeconomics - - Market Structure and Pricing - - - Monopoly
- L12 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Monopoly; Monopolization Strategies
- L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
This paper has been announced in the following NEP Reports:
- NEP-ALL-2008-03-25 (All new papers)
- NEP-COM-2008-03-25 (Industrial Competition)
- NEP-MIC-2008-03-25 (Microeconomics)
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Citations
Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.Cited by:
- Aguirre Pérez, Ignacio, 2011. "Welfare Effects of Third-Degree Price Discrimination: Ippolito Meets Schmalensee and Varian," IKERLANAK 2011-54, Universidad del País Vasco - Departamento de Fundamentos del Análisis Económico I.
- Takanori Adachi & Noriaki Matsushima, 2011.
"The Welfare Effects of Third-Degree PriceDiscrimination in a Differentiated Oligopoly,"
KIER Working Papers
800, Kyoto University, Institute of Economic Research.
- Takanori Adachi & Noriaki Matsushima, 2011. "The Welfare Effects of Third-Degree Price Discrimination in a Differentiated Oligopoly," ISER Discussion Paper 0800, Institute of Social and Economic Research, Osaka University.
- Armstrong, M, 2008.
"Price Discrimination,"
Open Access publications from University College London
http://discovery.ucl.ac.u, University College London.
- Armstrong, Mark, 2006. "Price discrimination," MPRA Paper 4693, University Library of Munich, Germany.
- Aguirre Pérez, Ignacio & Cowan, Simon & Vickers, John, 2009.
"Monopoly Price Discrimination and Demand Curvature,"
IKERLANAK
2009-39, Universidad del País Vasco - Departamento de Fundamentos del Análisis Económico I.
- I�aki Aguirre & Simon Cowan & John Vickers, 2010. "Monopoly Price Discrimination and Demand Curvature," American Economic Review, American Economic Association, vol. 100(4), pages 1601-15, September.
- Arghya Ghosh & Alberto Motta, 2011. "Outsourcing with Heterogeneous Firms," Discussion Papers 2011-09, School of Economics, The University of New South Wales.
- Simon GB Cowan & Simon Cowan, 2008. "When does third-degree price discrimination reduce social welfare, and when does it raise it?," Economics Series Working Papers 410, University of Oxford, Department of Economics.
- Li, Youping, 2011. "Timing of investments and third degree price discrimination in intermediate good markets," MPRA Paper 36746, University Library of Munich, Germany.
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