We develop a dynamic game model for efficient catastrophe risk-sharing that allows decision makers to derive optimal pricing, capital, and buying decisions in one equilibrium. Existing catastrophe insurance models focus on either the primary insurance market or the reinsurance market, thus involving one or two decision makers. Our model involves both markets and three decision makers: Individuals, a private insurer, and a centralized agency acting as reinsurer. We show that government reinsurance addresses the failure of the private catastrophe insurance market, increases individuals’ willingness to pay for catastrophe risk transfer, and represents a Pareto improvement on a competitive market with no reinsurance or with private reinsurance. The government’s trade-off between using catastrophe taxes and reinsurance premiums to fund the program improves the social welfare through product quality, capital cost, and wealth transfer channels. Furthermore, a government reinsurance program is a complement to an ex-post catastrophe-relief program and a risk-based solvency regulation.
{"title":"Catastrophe Risk-Sharing Decisions of Individuals, Insurer, and Government","authors":"Ruo Jia, Jieyu Lin, Hanyang (Hans) Wang","doi":"10.2139/ssrn.3270669","DOIUrl":"https://doi.org/10.2139/ssrn.3270669","url":null,"abstract":"We develop a dynamic game model for efficient catastrophe risk-sharing that allows decision makers to derive optimal pricing, capital, and buying decisions in one equilibrium. Existing catastrophe insurance models focus on either the primary insurance market or the reinsurance market, thus involving one or two decision makers. Our model involves both markets and three decision makers: Individuals, a private insurer, and a centralized agency acting as reinsurer. We show that government reinsurance addresses the failure of the private catastrophe insurance market, increases individuals’ willingness to pay for catastrophe risk transfer, and represents a Pareto improvement on a competitive market with no reinsurance or with private reinsurance. The government’s trade-off between using catastrophe taxes and reinsurance premiums to fund \u0000the program improves the social welfare through product quality, capital cost, and wealth transfer channels. Furthermore, a government reinsurance program is a complement to an ex-post catastrophe-relief program and a risk-based solvency regulation.","PeriodicalId":321987,"journal":{"name":"ERN: Pricing (Topic)","volume":"6 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2020-04-26","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"126943097","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Advocates of minimum pricing predicted that it would have an almost immediate impact in Scotland, with modelling forecasting 58 fewer deaths and 1,299 fewer hospital admissions in the first year. In the eight months after minimum pricing was introduced, alcohol-related mortality fell at the same rate in Scotland as it did in England and Wales (7%). Alcohol-related hospital admissions rose slightly in Scotland in 2018/19 under minimum pricing. The median Scottish household (by income) spent an extra £100.88 on alcohol in the first year of minimum pricing while the median income group in England spent an extra £44.20, a difference of £56.68 per annum. Those on below-average incomes have been hit hardest, with those in the bottom income group increasing their expenditure on alcohol by eleven per cent.
{"title":"Short Term Impact of Minimum Pricing for Alcohol in Scotland","authors":"C. Snowdon","doi":"10.2139/ssrn.3852038","DOIUrl":"https://doi.org/10.2139/ssrn.3852038","url":null,"abstract":"Advocates of minimum pricing predicted that it would have an almost immediate impact in Scotland, with modelling forecasting 58 fewer deaths and 1,299 fewer hospital admissions in the first year. In the eight months after minimum pricing was introduced, alcohol-related mortality fell at the same rate in Scotland as it did in England and Wales (7%). Alcohol-related hospital admissions rose slightly in Scotland in 2018/19 under minimum pricing. The median Scottish household (by income) spent an extra £100.88 on alcohol in the first year of minimum pricing while the median income group in England spent an extra £44.20, a difference of £56.68 per annum. Those on below-average incomes have been hit hardest, with those in the bottom income group increasing their expenditure on alcohol by eleven per cent.","PeriodicalId":321987,"journal":{"name":"ERN: Pricing (Topic)","volume":"43 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2020-04-09","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"115236997","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
We question the prevailing wisdom that a profit-maximizing monopolist using linear pricing cannot produce socially efficient output. We show that when market demand function exhibits a flat portion, the prevailing wisdom may not be true. Such a flat portion in demand is consistent with weakly convex preferences, and many general demand functions such as any polynomials of degree three and higher. Thus, our analysis demonstrates that the output distortion resulting from linear pricing by a profit-maximizing monopolist is demand specific. In general, neither monopoly per se nor linear pricing is the main reason for social inefficiency.
{"title":"With Linear Pricing, Can Profit-Maximizing Monopoly Output Be Socially Efficient?","authors":"Yong Chao, Babu Nahata","doi":"10.2139/ssrn.3601356","DOIUrl":"https://doi.org/10.2139/ssrn.3601356","url":null,"abstract":"We question the prevailing wisdom that a profit-maximizing monopolist using linear pricing cannot produce socially efficient output. We show that when market demand function exhibits a flat portion, the prevailing wisdom may not be true. Such a flat portion in demand is consistent with weakly convex preferences, and many general demand functions such as any polynomials of degree three and higher. Thus, our analysis demonstrates that the output distortion resulting from linear pricing by a profit-maximizing monopolist is demand specific. In general, neither monopoly per se nor linear pricing is the main reason for social inefficiency.","PeriodicalId":321987,"journal":{"name":"ERN: Pricing (Topic)","volume":"68 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2020-03-17","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"127140717","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
We study joint inventory-price control in which a firm chooses among a finite number of prices to influence the demand to be realized; also, the firm’s ordering activities incur fixed setup costs. While intending to settle down on an optimal price and figure out an optimal ordering policy all catering to the long-run average criterion, the firm is ambiguous about the stationary distribution of the random demand that it is to face under each price. We propose an adaptive policy in which periods are grouped into intervals, with each being associated with one single price and one single ordering policy. Pricing is based on a learning-while-doing trade-off: a price with the least number of interval visits will be chosen when this number is below a threshold associated with the total number of interval visits under all prices; otherwise, the chosen price will be one with the most promising profit prospect estimated from past experiences. Interval-wise ordering relies on an (s,S) policy most suitable for the empirical distribution learned from past experiences under the chosen price. The power at which the policy’s regret grows in the horizon length T would be below (3 +√29)/10 ≃ 0.839 even when demand patterns are fairly ambiguous. When demand realizations are further confined to a finite support, the bound would be reducible to √2/2 ≃ 0.707.
{"title":"Learning the Best Price and Ordering Policy under Fixed Costs and Ambiguous Demand","authors":"Jian Yang","doi":"10.2139/ssrn.3554042","DOIUrl":"https://doi.org/10.2139/ssrn.3554042","url":null,"abstract":"We study joint inventory-price control in which a firm chooses among a finite number of prices to influence the demand to be realized; also, the firm’s ordering activities incur fixed setup costs. While intending to settle down on an optimal price and figure out an optimal ordering policy all catering to the long-run average criterion, the firm is ambiguous about the stationary distribution of the random demand that it is to face under each price. We propose an adaptive policy in which periods are grouped into intervals, with each being associated with one single price and one single ordering policy. Pricing is based on a learning-while-doing trade-off: a price with the least number of interval visits will be chosen when this number is below a threshold associated with the total number of interval visits under all prices; otherwise, the chosen price will be one with the most promising profit prospect estimated from past experiences. Interval-wise ordering relies on an (s,S) policy most suitable for the empirical distribution learned from past experiences under the chosen price. The power at which the policy’s regret grows in the horizon length T would be below (3 +√29)/10 ≃ 0.839 even when demand patterns are fairly ambiguous. When demand realizations are further confined to a finite support, the bound would be reducible to √2/2 ≃ 0.707.","PeriodicalId":321987,"journal":{"name":"ERN: Pricing (Topic)","volume":"58 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2020-03-13","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"126767373","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
In this paper, we determine how premium payment methods impact effective prices (prices that include any consumer payment rewards). This question is fundamentally related to policy, and we provide a robust answer by considering how a variety of retail market structures are impacted by multiple payment methods. We find that, with a no-surcharge rule applied to the premium payment method, effective prices are often higher across all payment methods. In this case, the no-surcharge rule protects a double marginalization effect where the premium payment method inserts an additional margin that harms all consumers and all merchants. We show that this loss in welfare can be rectified by allowing merchant surcharging across payment methods. Our results are robust across merchant market structures, suggesting that protected premium payment methods are generally harmful, except for the payment industry.
{"title":"Do Premium Payment Methods Increase Effective Retail Prices?","authors":"Takanori Adachi, M. Tremblay","doi":"10.2139/ssrn.3450855","DOIUrl":"https://doi.org/10.2139/ssrn.3450855","url":null,"abstract":"In this paper, we determine how premium payment methods impact effective prices (prices that include any consumer payment rewards). This question is fundamentally related to policy, and we provide a robust answer by considering how a variety of retail market structures are impacted by multiple payment methods. We find that, with a no-surcharge rule applied to the premium payment method, effective prices are often higher across all payment methods. In this case, the no-surcharge rule protects a double marginalization effect where the premium payment method inserts an additional margin that harms all consumers and all merchants. We show that this loss in welfare can be rectified by allowing merchant surcharging across payment methods. Our results are robust across merchant market structures, suggesting that protected premium payment methods are generally harmful, except for the payment industry.","PeriodicalId":321987,"journal":{"name":"ERN: Pricing (Topic)","volume":"17 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2020-03-12","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"121927897","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Negotiations regularly take place on the business-to-business side of two-sided markets. However, little is known about the consequences of these negotiations on a platform's design, pricing, participation, and welfare. In this paper, we propose a model where platforms choose between the standard design (offering posted prices to both sides) and the bargaining design (offering a posted price to consumers and negotiating with firms). We find that platforms implement the bargaining design only when its bargaining position is strong. We also find that (i) greater platform bargaining power increases welfare and (ii) that a platform's optimal design can coincide with the design that maximizes welfare. These findings suggest that platforms and policy makers often align. Finally, we extend our model to consider platform competition and show that an implemented bargaining design generates sub-optimal welfare only when platforms are competitive. This suggests that platform behavior that may be considered exploitive, is only implemented in a manner that is detrimental to welfare in markets where platform market power is already limited.
{"title":"Business-to-Business Bargaining in Two-Sided Markets","authors":"Takanori Adachi, M. Tremblay","doi":"10.2139/ssrn.3388383","DOIUrl":"https://doi.org/10.2139/ssrn.3388383","url":null,"abstract":"Negotiations regularly take place on the business-to-business side of two-sided markets. However, little is known about the consequences of these negotiations on a platform's design, pricing, participation, and welfare. In this paper, we propose a model where platforms choose between the standard design (offering posted prices to both sides) and the bargaining design (offering a posted price to consumers and negotiating with firms). We find that platforms implement the bargaining design only when its bargaining position is strong. We also find that (i) greater platform bargaining power increases welfare and (ii) that a platform's optimal design can coincide with the design that maximizes welfare. These findings suggest that platforms and policy makers often align. Finally, we extend our model to consider platform competition and show that an implemented bargaining design generates sub-optimal welfare only when platforms are competitive. This suggests that platform behavior that may be considered exploitive, is only implemented in a manner that is detrimental to welfare in markets where platform market power is already limited.","PeriodicalId":321987,"journal":{"name":"ERN: Pricing (Topic)","volume":"3 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2020-03-11","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"116900245","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
When a firm’s competitor releases its product earlier than the firm, many consumers may decide to buy the competitor’s product, rather than wait for the firm’s product release. Hence, in the absence of product improvement effects or any other late-mover advantages, the firm should benefit by hastening its product release to avoid losing too many sales. In this paper, we analyze the strategic relationship between the firms’ product release timing and pricing decisions, and we find that even when there are no product improvement benefits and late-mover advantages, the firm may be better off by releasing its product later than the competitor. Furthermore, under certain conditions, the firm can benefit if its competitor captures a large share of the early market, rather than a small share. In other words, an increase in the competitor’s market penetration level can benefit the firm. Intuitively, by releasing its product later, the firm induces its less committed customers to buy the competitor’s product, while the firm’s more committed customers choose to wait for the firm’s product release. When the firm finally releases its product, it has an incentive to charge a higher price to extract more surplus from the segment of consumers who postponed their purchases. The firm’s increased price induces the firm’s competitor to also increase its price, alleviating price competition and benefiting all firms. Further, our results suggest that the firm that is the first to release its product may be better off by using penetration pricing strategy rather than price skimming, because penetration pricing will help mitigate future price competition, while price skimming will make it more intense.
{"title":"Late Product Release: The Strategic Benefit of Lost Sales","authors":"Mushegh Harutyunyan, C. Narasimhan","doi":"10.2139/ssrn.3552405","DOIUrl":"https://doi.org/10.2139/ssrn.3552405","url":null,"abstract":"When a firm’s competitor releases its product earlier than the firm, many consumers may decide to buy the competitor’s product, rather than wait for the firm’s product release. Hence, in the absence of product improvement effects or any other late-mover advantages, the firm should benefit by hastening its product release to avoid losing too many sales. In this paper, we analyze the strategic relationship between the firms’ product release timing and pricing decisions, and we find that even when there are no product improvement benefits and late-mover advantages, the firm may be better off by releasing its product later than the competitor. Furthermore, under certain conditions, the firm can benefit if its competitor captures a large share of the early market, rather than a small share. In other words, an increase in the competitor’s market penetration level can benefit the firm. Intuitively, by releasing its product later, the firm induces its less committed customers to buy the competitor’s product, while the firm’s more committed customers choose to wait for the firm’s product release. When the firm finally releases its product, it has an incentive to charge a higher price to extract more surplus from the segment of consumers who postponed their purchases. The firm’s increased price induces the firm’s competitor to also increase its price, alleviating price competition and benefiting all firms. Further, our results suggest that the firm that is the first to release its product may be better off by using penetration pricing strategy rather than price skimming, because penetration pricing will help mitigate future price competition, while price skimming will make it more intense.","PeriodicalId":321987,"journal":{"name":"ERN: Pricing (Topic)","volume":"15 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2020-03-11","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"130777908","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Abstract We experimentally investigate the determinants of post-cartel tacit collusion (PCTC), the effects of PCTC on market outcomes, and potential policy measures aimed at its prevention. PCTC occurs robustly with or without fines or leniency and is determined both by collusive price hysteresis and learning about cartel partners’ characteristics and strategies. As a result, it is also strongly related to the preceding cartel success. PCTC generates a downward bias in the estimated cartel overcharges. This threatens the effectiveness of deterrence induced by private damage litigation and fines imposed on colluding firms based on the overcharge. This bias further increases with preceding cartel stability such that especially more stable sets of colluding firms may be deterred less when PCTC is present. Rematching colluding subjects with strangers within a session prevents PCTC. This indicates that barring colluding managers from their posts could help impede PCTC in the field.
{"title":"Post-Cartel Tacit Collusion: Determinants, Consequences, and Prevention","authors":"Subhasish M. Chowdhury, Carsten J. Crede","doi":"10.2139/ssrn.3690629","DOIUrl":"https://doi.org/10.2139/ssrn.3690629","url":null,"abstract":"Abstract We experimentally investigate the determinants of post-cartel tacit collusion (PCTC), the effects of PCTC on market outcomes, and potential policy measures aimed at its prevention. PCTC occurs robustly with or without fines or leniency and is determined both by collusive price hysteresis and learning about cartel partners’ characteristics and strategies. As a result, it is also strongly related to the preceding cartel success. PCTC generates a downward bias in the estimated cartel overcharges. This threatens the effectiveness of deterrence induced by private damage litigation and fines imposed on colluding firms based on the overcharge. This bias further increases with preceding cartel stability such that especially more stable sets of colluding firms may be deterred less when PCTC is present. Rematching colluding subjects with strangers within a session prevents PCTC. This indicates that barring colluding managers from their posts could help impede PCTC in the field.","PeriodicalId":321987,"journal":{"name":"ERN: Pricing (Topic)","volume":"44 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2020-03-06","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"125170282","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
In retail settings with price promotions, consumers often search across stores and time. However the search literature typically only models one pass search across stores, ignoring revisits to stores; the choice literature using scanner data has modeled search across time, but not search across stores in the same model. We develop a multi-pass search model that jointly endogenizes search in both dimensions; our model nests a finite horizon model of search across stores within an infinite horizon model of inter-temporal search. We apply our model to milk purchases at grocery stores; hence the model also accounts for repeat purchases across time, inventory holding by households and grocery basket effects. We note that the special case without these additional features can be used to study one time purchases with repeat store visits as in the case of durable goods and online shopping. We formulate the empirical model as a mathematical program with equilibrium constraints (MPEC) and estimate it allowing for latent class heterogeneity using an iterative E-M algorithm. In contrast to extant research, we find that omitting the temporal dimension underestimates price elasticity. We attribute this difference to the relative frequency of household stockouts and purchase frequency in the milk category. Interestingly, increasing the promotional frequency (while reducing its depth to maintain the mean and variance of prices across all stores) can increase loyalty to the household’s preferred store.
{"title":"A Model of Multi-Pass Search: Price Search Across Stores and Time","authors":"N. Mojir, K. Sudhir","doi":"10.2139/ssrn.3543823","DOIUrl":"https://doi.org/10.2139/ssrn.3543823","url":null,"abstract":"In retail settings with price promotions, consumers often search across stores and time. However the search literature typically only models one pass search across stores, ignoring revisits to stores; the choice literature using scanner data has modeled search across time, but not search across stores in the same model. We develop a multi-pass search model that jointly endogenizes search in both dimensions; our model nests a finite horizon model of search across stores within an infinite horizon model of inter-temporal search. We apply our model to milk purchases at grocery stores; hence the model also accounts for repeat purchases across time, inventory holding by households and grocery basket effects. We note that the special case without these additional features can be used to study one time purchases with repeat store visits as in the case of durable goods and online shopping. We formulate the empirical model as a mathematical program with equilibrium constraints (MPEC) and estimate it allowing for latent class heterogeneity using an iterative E-M algorithm. In contrast to extant research, we find that omitting the temporal dimension underestimates price elasticity. We attribute this difference to the relative frequency of household stockouts and purchase frequency in the milk category. Interestingly, increasing the promotional frequency (while reducing its depth to maintain the mean and variance of prices across all stores) can increase loyalty to the household’s preferred store.","PeriodicalId":321987,"journal":{"name":"ERN: Pricing (Topic)","volume":"21 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2020-02-25","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"128536535","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
With welfare implication, we analyze the endogenous choice of competition mode where asymmetric retailers for the cost involve in price discrimination and uniform pricing with an upstream input supplier under vertical contracts. In contrast to previous results, we find that under uniform pricing, if the cost difference between asymmetric retailers is sufficiently small, then choosing price contract is a dominant strategy for both retailers. On the other hand, if the cost difference is sufficiently large, choosing price contract for inefficient retailer and choosing quantity contract for efficient retailer are implemented in equilibrium under uniform pricing, while this equilibrium is sustained regardless of cost difference under price discrimination. Moreover, social welfare is always higher under uniform pricing than under price discrimination even though each equilibrium under uniform pricing facilitates implicit collusion in the endogenous choice of competition mode.
{"title":"Endogenous Competition Mode with Asymmetric Retailers","authors":"Kangsik Choi, Seonyoung Lim","doi":"10.2139/ssrn.3542115","DOIUrl":"https://doi.org/10.2139/ssrn.3542115","url":null,"abstract":"With welfare implication, we analyze the endogenous choice of competition mode where asymmetric retailers for the cost involve in price discrimination and uniform pricing with an upstream input supplier under vertical contracts. In contrast to previous results, we find that under uniform pricing, if the cost difference between asymmetric retailers is sufficiently small, then choosing price contract is a dominant strategy for both retailers. On the other hand, if the cost difference is sufficiently large, choosing price contract for inefficient retailer and choosing quantity contract for efficient retailer are implemented in equilibrium under uniform pricing, while this equilibrium is sustained regardless of cost difference under price discrimination. Moreover, social welfare is always higher under uniform pricing than under price discrimination even though each equilibrium under uniform pricing facilitates implicit collusion in the endogenous choice of competition mode.","PeriodicalId":321987,"journal":{"name":"ERN: Pricing (Topic)","volume":"34 1","pages":"0"},"PeriodicalIF":0.0,"publicationDate":"2020-02-21","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"132943939","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
京公网安备 11010802042870号
京ICP备2023020795号-1
扫码关注我们
求助内容：
应助结果提醒方式：