Oligopolistic Non-Linear Pricing and Size Economies
AbstractThe effects of non-linear pricing are determined by the relationship between the demand and the technological structure of the market. This paper focuses on a model in which firms supply a homogeneous product in two different sizes. Information about consumers' reservation prices is incomplete and the production technology is characterized by size economies. Four equilibrium regions are identified depending on the relative intensity of size economies with respect to consumers' evaluation of a second unit of the good. The desirability of non-linear pricing varies across different equilibrium regions.
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Bibliographic InfoPaper provided by Department of Economics, University of York in its series Discussion Papers with number 08/07.
Date of creation: May 2008
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More information through EDIRC
non-linear pricing; size economies; supply technology.;
Find related papers by JEL classification:
- D43 - Microeconomics - - Market Structure and Pricing - - - Oligopoly and Other Forms of Market Imperfection
- 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
This paper has been announced in the following NEP Reports:
- NEP-ALL-2008-05-10 (All new papers)
- NEP-IND-2008-05-10 (Industrial Organization)
- NEP-MIC-2008-05-10 (Microeconomics)
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