Pricing in networks

Francis Bloch and Nicolas Querou

Working Papers from HAL

Abstract: This paper studies optimal pricing in networks in the presence of local consumption or price externalities. It analyzes the relation between prices and nodal centrality measures. Using an asymptotic approach, it shows that the ranking of optimal prices and strategies can be reduced to the lexicographic ranking of a specific vector of nodal characteristics. In particular, this result shows that with positive consumption externalities, prices are higher at nodes with higher degree, and with relative price externalities, prices are higher at nodes which have more neighbors of smaller degree.

Keywords: Social Networks; Network Externalities; Oligopolies; Réseaux sociaux; externalités de réseau; oligopoles (search for similar items in EconPapers)
Date: 2008-10
Note: View the original document on HAL open archive server: https://hal.science/hal-00356356
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Citations: View citations in EconPapers (5)

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