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Working paper

Welfare-increasing third-degree price discrimination

Abstract:

The welfare and output effects of monopoly third-degree price discrimination are analyzed when inverse demand functions are parallel. Welfare is higher with discrimination than with a uniform price when demand functions are derived from the logistic distribution, and from a more general class of distributions. The sufficient condition in Varian (1985) for a welfare increase holds for these demand functions. Total output is higher with discrimination for a large set of demand functions incl...

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Publication status:
Published

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Publisher:
University of Oxford Publisher's website
Series:
Department of Economics Discussion Paper Series
Publication date:
2013-04-22
Paper number:
652
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Pubs id:
1143767
Local pid:
pubs:1143767
Deposit date:
2020-12-15

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