Bergemann, Dirk
[VerfasserIn]
;
Castro, Francisco
[Sonstige Person, Familie und Körperschaft];
Weintraub, Gabriel Y.
[Sonstige Person, Familie und Körperschaft]
Third-degree Price Discrimination versus Uniform Pricing
Erschienen in:Cowles Foundation Discussion Paper ; No. 2213
Umfang:
1 Online-Ressource (21 p)
Sprache:
Englisch
DOI:
10.2139/ssrn.3503411
Identifikator:
Entstehung:
Anmerkungen:
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments December 12, 2019 erstellt
Beschreibung:
We compare the revenue of the optimal third-degree price discrimination policy against a uniform pricing policy. A uniform pricing policy offers the same price to all segments of the market. Our main result establishes that for a broad class of third-degree price discrimination problems with concave revenue functions and common support, a uniform price is guaranteed to achieve one half of the optimal monopoly profits. This revenue bound obtains for any arbitrary number of segments and prices that the seller would use in case he would engage in third-degree price discrimination. We further establish that these conditions are tight, and that a weakening of common support or concavity leads to arbitrarily poor revenue comparisons