Monopoly Price Discrimination and Demand Curvature
Iñaki Aguirre, Simon Cowan, John Vickers
American Economic Review · 2010 · Volume 100 · Issue 4
Abstract
This paper presents a general analysis of the effects of monopolistic third-degree price discrimination on welfare and output when all markets are served. Sufficient conditions — involving straightforward comparisons of the curvatures of the direct and inverse demand functions in the different markets — are presented for discrimination to have negative or positive effects on social welfare and output. (JEL D42)
Keywords
Market Structure and Pricing: Monopoly
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