Authors

• Francisco Galera (fgalera@unav.es)
  School of Economics and Business Administration, University of Navarra
• José Luis Álvarez (jlalvarez@unav.es)
  School of Economics and Business Administration, University of Navarra
• Juan Carlos Molero (jcmolero@unav.es)
  School of Economics and Business Administration, University of Navarra

Abstract
This paper studies technology choice as a relevant aspect to be considered when analyzing price discrimination and welfare. Our results reinforce the traditional wisdom that an increase in output is a necessary condition for price discrimination to improve social welfare. But we also find that the positive output effect does not need to be as large as previously supposed since, under some conditions, the monopoly will move to a socially preferred technology only if third-degree price discrimination is allowed.

Classification JEL:D42, L12, L13

Keywords:monopoly, technology choice, third degree price discrimination

Number of Pages:9

Creation Date:2012-10-14

Number:null/12