Price Discrimination in Markets for Experts´ Services
AbstractThis article studies the consequences of price discrimination in a market for experts´services. In the case of experts markets, where the expert observers the intervention that a consumer needs to fix his problem and also provides a treatment, price discrimination proceeds along the dimension of quality of advice offered. High quality advice and appropriate treatment is providid to the most profitable market segment only. Less profitable consumers are induced to demand either unnecessary or insufficient procedures. The welfare consequences of price discrimination are ambiguous: On the one hand, price discrimination increases the number of consumers that get an intervention. On the other hand, sone consumers that are efficiently served under nondiscrimination get the wrong procedure if the expert can discriminate among customers.
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Bibliographic InfoPaper provided by University of Vienna, Department of Economics in its series Vienna Economics Papers with number 0312.
Date of creation: Aug 2003
Date of revision:
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Web page: http://www.univie.ac.at/vwl
Other versions of this item:
- Dulleck, Uwe & Kerschbamer, Rudolf, 2003. "Price Discrimination in Markets for Experts' Services," CEPR Discussion Papers 4155, C.E.P.R. Discussion Papers.
- L15 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Information and Product Quality
- D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
- D40 - Microeconomics - - Market Structure and Pricing - - - General
This paper has been announced in the following NEP Reports:
- NEP-IND-2003-09-14 (Industrial Organization)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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