First-Degree Discrimination in a Competitive Setting: Pricing and Quality Choice

Topics:
Competitive Pricing,
Pricing and Margins,
Pricing Strategy
Tags:
Marketing,
Marketing Research,
Pricing,
Pricing Strategy
Source:
Universite de Montreal

FREE Registration is required

Overview: The paper investigates competition in price schedules among vertically differentiated dupolists. First order price discrimination is the unique Nash equilibrium of a sequential game in which firms determine first whether or not to commit to a uniform price, and then simultaneously choose either a single price of a price schedule. Whether the profits earned by both firms are larger or smaller under discrimination than under uniform pricing depends on the quality gap between firms, and on the disparity of consumer preferences. Firms engaged in first degree discrimination choose quality levels that are optimal from a welfare perspective. The paper also reflects on implications of these findings for pricing policies of an incumbent threatened by entry.

(Is this item miscategorized? Does it need more tags? Let us know.)

Format: PDF | Size: 283KB | Date: Jan 2005 | Pages: 26

People who downloaded this item also downloaded

White Paper Five Principles To Improve Your Leadership Skills
White Paper Self Regulation Or Price Discrimination
White Paper Determining A Plan For Setting Prices
White Paper TQM, ISO 9000, Six Sigma: Do Process Management Programs Discourage Innovation?
White Paper A Dynamic Model of Brand Choice When Price and Advertising Signal Product Quality

Top results from Competitive Pricing

White Paper How to Avoid Competing on Price
White Paper Managing Brands In The Realm Of Dynamic Pricing
White Paper How Buyers See Price
White Paper Game Theory Should Guide Pricing Strategy, But Be Sure To Pick The Right Playing Field
White Paper Responding To Penetration Pricing In Turbulent Markets

» View all Competitive Pricing listings

advertisement
advertisement
  • Click Here
  • Click Here
  • Click Here
advertisement

Returning users: Log In Here!

Already registered on BNET, TechRepublic, or ZDNet? Simply log in.

Free Membership: Sign Up Now!

Sign up for a free membership today and get instant and unlimited access to one of the largest databases of white papers, webcasts, and casestudies anywhere. Your FREE membership allows you to:

  • Download an unlimited amount of content, including classic and current white papers, case studies, webcasts and more
  • Track content on your chosen topics of interest
  • Receive targeted email alerts when your favorite content is added
  • Save content for future reading
  • Receive our member newsletter

When you register to access this directory, you become a member of BNET. In addition, you allow us to share your information with companies that produce products or services featured in the library--so that such companies may contact you with information and offers regarding their products and services. This enables us to keep the library a free service. As a directory registrant, you will receive a complimentary subscription to the BNET member newsletter, The BNET Report. You can unsubscribe from this newsletter at any time. By clicking the Sign up button, you indicate that you agree to our Terms and Conditions and have read and understand our Privacy Policy (updated).