Economics at your fingertips  

Regulating monopoly price discrimination

Simon Cowan

Journal of Regulatory Economics, 2018, vol. 54, issue 1, 1-13

Abstract: Abstract A monopolist sells its product in separated markets. The effects of requiring a uniform profit margin instead of monopoly pricing are assessed. A margin equal to the output-weighted arithmetic mean of the monopoly margins raises consumer surplus but reduces total output. When the margin equals the (lower) harmonic mean total output exceeds the monopoly level if the demand functions are convex, and social welfare rises. Extensions cover a uniform price-marginal cost ratio and a uniform margin when the initial price is uniform and costs differ. The analysis uses convexity relations and the implications of profit-maximization.

Keywords: Price discrimination; Monopoly; Margin regulation (search for similar items in EconPapers)
JEL-codes: D42 L12 L13 (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3) Track citations by RSS feed

Downloads: (external link) Abstract (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link:

Ordering information: This journal article can be ordered from
http://www.springer. ... on/journal/11149/PS2

Access Statistics for this article

Journal of Regulatory Economics is currently edited by Michael A. Crew

More articles in Journal of Regulatory Economics from Springer
Bibliographic data for series maintained by Sonal Shukla ().

Page updated 2019-12-06
Handle: RePEc:kap:regeco:v:54:y:2018:i:1:d:10.1007_s11149-018-9361-2