A Model of Third-Degree Price Discrimination with Positive Welfare Effects

Aug 2017 | 829

Authors: Simon Cowan

Monopoly third-degree price discrimination raises social welfare above the level with a uniform price when direct demand functions have constant curvatures that differ across markets and are below 1, and the maximum willingness to pay is identical across markets.

JEL Codes: D42, L12, L13

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