Price discrimination with divisible goods

This paper studies second-degree price discrimination (SPD) in cases involving products with divisible quantities and sold in many presentations (carbonated soft drink, beer, packaged bread, ready-to-eat cereals, laundry products, etc.). Differently from the standard case, consumers may have the opt...

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Detalles Bibliográficos
Autor principal: Cont, Walter Alberto
Formato: Objeto de conferencia
Lenguaje:Inglés
Publicado: 2012
Materias:
Ciencias Económicas
second-degree price discrimination
consumidores
Acceso en línea:http://sedici.unlp.edu.ar/handle/10915/173773
Aporte de:
SEDICI (UNLP) de Universidad Nacional de La Plata
id I19-R120-10915-173773
record_format dspace
spelling I19-R120-10915-1737732024-11-27T20:12:51Z http://sedici.unlp.edu.ar/handle/10915/173773 Price discrimination with divisible goods Cont, Walter Alberto 2012-11 2012 2024-11-27T18:11:36Z en Ciencias Económicas second-degree price discrimination consumidores This paper studies second-degree price discrimination (SPD) in cases involving products with divisible quantities and sold in many presentations (carbonated soft drink, beer, packaged bread, ready-to-eat cereals, laundry products, etc.). Differently from the standard case, consumers may have the option to choose more than one package when comparing different product presentations; therefore, standard SPD may not cover all self-selection constraints. We solve an extended SPD problem (ESPD) and characterize the solution for two types of preferences. As in SPD, the seller provides the efficient quantity to high-WTP consumers and introduces inefficiencies in packages designed for low-WTP consumers. But the distortion is less than that suggested by SPD, provided that the seller attends both consumer types. Closing the market for low-WTP consumers (when SPD suggests to keep it open) is also a possibility if the two distortions introduced in the ESPD -the standard trade off between inefficiency and consumer surplus, and the n-arbitration constraint for high-WTP consumers- are too costly to the seller. Given the possibility for high-WTP consumers to consume more than one unit of small packages, the seller offers deeper quantity discounts, provided that he finds profitable to sell both consumer types. Este paper estudia el problema de discriminación de precios de segundo grado (DPS) aplicado a productos con cantidades divisibles y múltiples presentaciones (bebidas gaseosas, cerveza, pan lactal, cereales para desayuno, jabones en polvo, etc.). A diferencia del caso estándar, los consumidores pueden tener la opción de elegir más de un paquete al comparar diferentes presentaciones. En estos casos, la solución estándar de DPS puede no cubrir todas las restricciones relevantes de auto-selección. En la solución al problema de DPS ampliado (DPSA) para el caso de información privada del consumidor particionada en dos types, el vendedor provee la cantidad eficiente para consumidores de alta valoración e introduce ineficiencias en el paquete diseñado para consumidores de baja valoración. Pero la distorsión es menor que la sugerida en DPS, si el vendedor atiende ambos tipos de consumidores. Cerrar el mercado para consumidores de baja valoración (cuando DPS sugiere atenderlos) es óptimo si las dos distorsiones que entran en juego -el trade off entre eficiencia y extracción de excedente del consumidor y la restricción de arbitrar con n paquetes por parte de los consumidores de alta valoración- son demasiado costosas para el vendedor. Dado que los consumidores de alta valoración tienen la opción de consumir más de un paquete pequeño, el vendedor debe ofrecer mayores descuentos por cantidad cuando decide mantener abierto el mercado para consumidores de baja valoración. Facultad de Ciencias Económicas Objeto de conferencia Objeto de conferencia http://creativecommons.org/licenses/by-nc-sa/4.0/ Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International (CC BY-NC-SA 4.0) application/pdf
institution Universidad Nacional de La Plata
institution_str I-19
repository_str R-120
collection SEDICI (UNLP)
language Inglés
topic Ciencias Económicas
second-degree price discrimination
consumidores
spellingShingle Ciencias Económicas
second-degree price discrimination
consumidores
Cont, Walter Alberto
Price discrimination with divisible goods
topic_facet Ciencias Económicas
second-degree price discrimination
consumidores
description This paper studies second-degree price discrimination (SPD) in cases involving products with divisible quantities and sold in many presentations (carbonated soft drink, beer, packaged bread, ready-to-eat cereals, laundry products, etc.). Differently from the standard case, consumers may have the option to choose more than one package when comparing different product presentations; therefore, standard SPD may not cover all self-selection constraints. We solve an extended SPD problem (ESPD) and characterize the solution for two types of preferences. As in SPD, the seller provides the efficient quantity to high-WTP consumers and introduces inefficiencies in packages designed for low-WTP consumers. But the distortion is less than that suggested by SPD, provided that the seller attends both consumer types. Closing the market for low-WTP consumers (when SPD suggests to keep it open) is also a possibility if the two distortions introduced in the ESPD -the standard trade off between inefficiency and consumer surplus, and the n-arbitration constraint for high-WTP consumers- are too costly to the seller. Given the possibility for high-WTP consumers to consume more than one unit of small packages, the seller offers deeper quantity discounts, provided that he finds profitable to sell both consumer types.
format Objeto de conferencia
Objeto de conferencia
author Cont, Walter Alberto
author_facet Cont, Walter Alberto
author_sort Cont, Walter Alberto
title Price discrimination with divisible goods
title_short Price discrimination with divisible goods
title_full Price discrimination with divisible goods
title_fullStr Price discrimination with divisible goods
title_full_unstemmed Price discrimination with divisible goods
title_sort price discrimination with divisible goods
publishDate 2012
url http://sedici.unlp.edu.ar/handle/10915/173773
work_keys_str_mv AT contwalteralberto pricediscriminationwithdivisiblegoods
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