Wholesale price discrimination and enforcement of regulation

Hiroshi Aiura ()
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Hiroshi Aiura: Faculty of Economics, Oita University

Economics Bulletin, 2010, vol. 30, issue 3, 2083-2091

Abstract: The present paper studied third-degree price discrimination in wholesale markets and its welfare property when a monopolistic manufacturer sells his/her products to two retailers who have different qualities and costs of sales. Our results revealed that price discrimination within a certain extent increases social welfare under some conditions, which would support the soft enforcement of prohibiting price discrimination by a monopolistic wholesaler.

Keywords: Third-degree price discrimination; Price competition with vertical differentiation; Upstream-Downstream relationships (search for similar items in EconPapers)
JEL-codes: K2 L1 (search for similar items in EconPapers)
Date: 2010-08-12
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