Two-Park Tariffs and Consumption Externalities

Stephen Littlechild

Bell Journal of Economics, 1975, vol. 6, issue 2, 661-670

Abstract: This paper provides explicit characteristics of those two-part tariffs which maximize profit and consumers' plus producer's surplus. The effect of consumption externalities (as in telecommunications systems) is then explored. The characterizations are in terms of elasticities of demand with respect to price, income, and the number of other customers in the system.

Date: 1975
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