Detalle Publicación


The cost effect in third-degree price discrimination

Título de la revista: JOURNAL OF ECONOMICS
ISSN: 0931-8658
Volumen: 113
Número: 2
Páginas: 175 - 186
Fecha de publicación: 2014
In the presence of a non-constant marginal cost and demand uncertainty, we show that an output increase is no longer a necessary condition for welfare to increase following the introduction of third-degree price discrimination. We thus highlight the existence of an effect that might offset the well known output and misallocation effects of price discrimination. We propose a specific example where this is indeed the case