On the anti-competitive effects of quantity discounts

Giacomo Calzolari () and Vincenzo Denicolo' ()

International Journal of Industrial Organization, 2011, vol. 29, issue 3, 337-341

Abstract: We analyze the competitive effects of quantity discounts in an asymmetric duopoly. We find that for a sizeable set of parameter values, quantity discounts harm the smaller firm and reduce consumers' surplus. They can even decrease social welfare, i.e. the sum of producers' and consumers' surpluses. However, the circumstances in which quantity discounts may decrease social welfare are limited and difficult to identify in practice.

Keywords: Quantity; discounts; Non-linear; pricing; Exclusion; Dominant; firm (search for similar items in EconPapers)
Date: 2011
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Citations: View citations in EconPapers (8)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:indorg:v:29:y:2011:i:3:p:337-341

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