A NOTE ON THE ECONOMICS OF PASS-THROUGH WITH TWO-PART TARIFF PRICING

Dov Rothman

Journal of Competition Law and Economics, 2015, vol. 11, issue 2, 401-408

Abstract: When a firm sells a product together with another product, it may rely on a two-part tariff. I explain that when a firm uses a two-part tariff, a cost increase may or may not be passed through to final consumers. Depending on the characteristics of final consumers’ demand, a cost increase could result in no increase in the price of either product, an increase in the price of both products, or an increase in the price of one product and a decrease in the price of the other product.

JEL-codes: K21 L11 L41 (search for similar items in EconPapers)
Date: 2015
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:oup:jcomle:v:11:y:2015:i:2:p:401-408.

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Journal of Competition Law and Economics is currently edited by Nicholas Economides, Amelia Fletcher, Michal Gal, Damien Geradin, Ioannis Lianos and Tommaso Valletti

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