Third-Degree Price Discrimination in the Presence of Asymmetric Consumption Externalities

被引:7
作者
Ikeda, Takeshi [1 ]
Nariu, Tatsuhiko [2 ]
机构
[1] Kobe Int Univ, Sch Econ, 9-1-6 Koyo Cho Naka, Kobe, Hyogo 6580032, Japan
[2] Kyoto Univ, Grad Sch Business Adm, Sakyo, Kyoto 6068501, Japan
关键词
third-degree price discrimination; consumption externalities; price elasticity of demand;
D O I
10.1007/s10842-008-0046-x
中图分类号
F [经济];
学科分类号
02 ;
摘要
In this paper, we consider third-degree price discrimination in two markets in the presence of asymmetric consumption externalities; we establish that under plausible conditions, a firm reduces its price in the market with low price elasticity of demand. The firm can increase its profits by reducing the price for these consumers and enlarging the demand for other consumers, provided that positive consumption externalities exist. Moreover, we show that third-degree price discrimination enhances not only the firm's profit but also total consumer surplus.
引用
收藏
页码:251 / 261
页数:11
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