Contemporaneous Most-Favoured-Customer Pricing Policy vs. Price Discrimination in a Differentiated Product Duopoly Market

Amarjyoti Mahanta ()
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Amarjyoti Mahanta: Indian Institute of Technology, Guwahati

Economics Bulletin, 2016, vol. 36, issue 1, 75-83

Abstract: In this paper a third degree price discrimination is analyzed in a differentiated product duopoly market. The main question is whether both firms should engage in price discrimination. An asymmetric equilibrium is derived in which one firm engages in price discrimination while the other firm sets a uniform price in both markets. This is done through the adoption of contemporaneous most favoured customer clause.

Keywords: Oligopoly Pricing; Price Discrimination. (search for similar items in EconPapers)
JEL-codes: D4 L0 (search for similar items in EconPapers)
Date: 2016-02-04
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