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Intertemporal Price Discrimination and Competition

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  • Ralph-C Bayer

    () (School of Economics, University of Adelaide)

Abstract

In this study we investigate the impact of competition on markets for non-durable goods where intertemporal price discrimination is possible. We develop a simple model of different potential scenarios for intertemporal price discrimination and implement it in a laboratory experiment. We compare the outcomes in monopolies and duopolies. Surprisingly, we find that competition does not necessarily prevent intertemporal price discrimination, as our model predicts. However, competition generally reduces sales prices, but by far less than theory predicts. As expected, competition increases efficiency.

Suggested Citation

  • Ralph-C Bayer, 2006. "Intertemporal Price Discrimination and Competition," School of Economics Working Papers 2006-06, University of Adelaide, School of Economics.
  • Handle: RePEc:adl:wpaper:2006-06
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    File URL: http://www.economics.adelaide.edu.au/research/papers/doc/wp2006-06.pdf
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    Cited by:

    1. Bayer, Ralph-C. & Ke, Changxia, 2013. "Discounts and consumer search behavior: The role of framing," Journal of Economic Psychology, Elsevier, vol. 39(C), pages 215-224.
    2. repec:gam:jgames:v:9:y:2018:i:1:p:10-:d:132752 is not listed on IDEAS
    3. repec:gam:jeners:v:11:y:2018:i:2:p:458-:d:132747 is not listed on IDEAS

    More about this item

    Keywords

    price discrimination; oligopoly; market experiments;

    JEL classification:

    • 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
    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior

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