Price Discrimination, Competition and Regulation.
This paper analyzes some effects of price discrimination policy in a model where a dominant incumbent firm faces an endogenous degree of competition in one of its two markets. Banning price discrimination tends to encourage more entry, which is desirable if the entrant is as efficient as the incumb...
| Main Authors: | , |
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| Format: | Working paper |
| Language: | English |
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Department of Economics (University of Oxford)
1992
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| _version_ | 1826298209711947776 |
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| author | Armstrong, M Vickers, J |
| author_facet | Armstrong, M Vickers, J |
| author_sort | Armstrong, M |
| collection | OXFORD |
| description | This paper analyzes some effects of price discrimination policy in a model where a dominant incumbent firm faces an endogenous degree of competition in one of its two markets. Banning price discrimination tends to encourage more entry, which is desirable if the entrant is as efficient as the incumbent but has ambiguous welfare effects more generally. Prices in both markets might fall. Price discrimination policy under different forms of price regulation is also examined. If the incumbent's average price level is regulated, then allowing price discrimination can lead to pricing below marginal cost, with possible anticompetitive consequences. |
| first_indexed | 2024-03-07T04:43:23Z |
| format | Working paper |
| id | oxford-uuid:d2682cab-51fb-4611-9cb5-5bbb64c34158 |
| institution | University of Oxford |
| language | English |
| last_indexed | 2024-03-07T04:43:23Z |
| publishDate | 1992 |
| publisher | Department of Economics (University of Oxford) |
| record_format | dspace |
| spelling | oxford-uuid:d2682cab-51fb-4611-9cb5-5bbb64c341582022-03-27T08:03:42ZPrice Discrimination, Competition and Regulation.Working paperhttp://purl.org/coar/resource_type/c_8042uuid:d2682cab-51fb-4611-9cb5-5bbb64c34158EnglishDepartment of Economics - ePrintsDepartment of Economics (University of Oxford)1992Armstrong, MVickers, J This paper analyzes some effects of price discrimination policy in a model where a dominant incumbent firm faces an endogenous degree of competition in one of its two markets. Banning price discrimination tends to encourage more entry, which is desirable if the entrant is as efficient as the incumbent but has ambiguous welfare effects more generally. Prices in both markets might fall. Price discrimination policy under different forms of price regulation is also examined. If the incumbent's average price level is regulated, then allowing price discrimination can lead to pricing below marginal cost, with possible anticompetitive consequences. |
| spellingShingle | Armstrong, M Vickers, J Price Discrimination, Competition and Regulation. |
| title | Price Discrimination, Competition and Regulation. |
| title_full | Price Discrimination, Competition and Regulation. |
| title_fullStr | Price Discrimination, Competition and Regulation. |
| title_full_unstemmed | Price Discrimination, Competition and Regulation. |
| title_short | Price Discrimination, Competition and Regulation. |
| title_sort | price discrimination competition and regulation |
| work_keys_str_mv | AT armstrongm pricediscriminationcompetitionandregulation AT vickersj pricediscriminationcompetitionandregulation |