A Guide to the Pitfalls of Identifying Price Discrimination

Lott, John R, and Russell D Roberts

Economic Inquiry, 1991, vol. 29, issue 1, 14-23

Abstract: This paper demonstrates that plausible cost-based explanations exist for what are commonly perceived to be cases of price discrimination. The authors explain such commonly discussed problems as the price spreads of retail gasoline products, the "high" price of dinners at restaurants, the "high" price of popcorn at movie theaters, and the fact that airline ticket prices vary with how long the ticket is purchased before the flight's departure. Their explanations benefit from not relying on consumer ignorance or implicit collusion among numerous sellers. Copyright 1991 by Oxford University Press.

Date: 1991
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