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Multiproduct pricing made simple

Abstract:

We study multiproduct firms in the contexts of unregulated monopoly, regulated monopoly, and Cournot oligopoly. Using the concept of consumer surplus as a function of quantities (rather than prices), we present simple formulas for optimal prices and show that Cournot equilibrium exists and corresponds to a Ramsey optimum. We then discuss a tractable class of preferences that involve a generalized form of homotheticity. Profit-maximizing quantities are proportional to efficient quantities. We ...

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Publication status:
Published
Peer review status:
Peer reviewed

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Publisher copy:
10.1086/697902

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More by this author
Institution:
University of Oxford
Division:
SSD
Department:
Economics
Role:
Author
More by this author
Institution:
University of Oxford
Division:
SSD
Department:
Economics
Role:
Author
Publisher:
University of Chicago Press
Journal:
Journal of Political Economy More from this journal
Volume:
126
Issue:
4
Pages:
1444-1471
Publication date:
2018-07-02
Acceptance date:
2017-02-09
DOI:
EISSN:
1537-534X
ISSN:
0022-3808
Keywords:
Pubs id:
pubs:679268
UUID:
uuid:cc3d65a5-76c2-4e97-9d04-4505c065db6a
Local pid:
pubs:679268
Deposit date:
2017-03-28

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