A new contribution to the 'Paris Metro Pricing' proposal

Maxime de Marin de Montmarin

Applied Economics, 2007, vol. 39, issue 13, 1609-1612

Abstract: Using the concept of the 'Paris Metro Pricing', we will show that, when the distribution of the capacity between sub-networks leads to any loss of technical effectiveness and when a traditional condition on the 'hazard rate' is checked, it is always optimal for the monopolist to subdivide his main network in as many sub-networks as there are different types of net surfers.

Date: 2007
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DOI: 10.1080/00036840600690173

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