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Price discrimination in oligopoly with asymmetric firms

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  • Arijit Mukherjee

Abstract

We generalize the analyses of Hazledine (2006, "Price discrimination in Cournot-Nash oligopoly", Economics Letters) and Kutlu (2009, "Price discrimination in Stackelberg competition", Journal of Industrial Economics) with asymmetric cost firms. We show that the main result of Hazledine, which shows that the average revenue is not dependent on the extent of price discrimination, remains under cost asymmetry but at the industry level. However, the main result of Kutlu, which shows that the Stackelberg leader does not price discriminate at all, does not hold under cost asymmetry. Both the leader and the follower discriminate price under cost asymmetry.

Suggested Citation

  • Arijit Mukherjee, 2010. "Price discrimination in oligopoly with asymmetric firms," Discussion Papers 10/04, University of Nottingham, School of Economics.
    • Handle: RePEc:not:notecp:10/04
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    References listed on IDEAS

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    1. Hazledine, Tim, 2006. "Price discrimination in Cournot-Nash oligopoly," Economics Letters, Elsevier, vol. 93(3), pages 413-420, December.
    2. Armstrong, Mark, 2006. "Price discrimination," MPRA Paper 4693, University Library of Munich, Germany.
    3. Levent Kutlu, 2009. "Price Discrimination In Stackelberg Competition," Journal of Industrial Economics, Wiley Blackwell, vol. 57(2), pages 364-364, June.
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    Cited by:

    1. Kutlu, Levent, 2012. "Price discrimination in Cournot competition," Economics Letters, Elsevier, vol. 117(3), pages 540-543.
    2. Levent Kutlu, 2017. "A conduct parameter model of price discrimination," Scottish Journal of Political Economy, Scottish Economic Society, vol. 64(5), pages 530-536, November.

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    JEL classification:

    • D4 - Microeconomics - - Market Structure, Pricing, and Design
    • L0 - Industrial Organization - - General

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