Price Discrimination As Portfolio Diversification

Parikshit Ghosh ()
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Parikshit Ghosh: Indian Statistical Institute

Economics Bulletin, 2008, vol. 4, issue 5, pages 1-9

Abstract: A seller seeking to sell an indivisible object can post (possibly different) prices to each of n buyers. Buyers' valuations are private information and drawn independently from the same distribution. If the seller can choose who to sell to in the event there are several willing buyers, her optimal strategy is to post different prices to different buyers. For some distributions, price discrimination may be profitable even if excess demand must be resolved through a uniform lottery.

Keywords: price discrimination; portfolio diversification; monopoly; posted price (search for similar items in EconPapers)
JEL-codes: D4 D8 (search for similar items in EconPapers)
Date: 2008-03-07
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