Is List Pricing and Discounting Procompetitive? Tacit Collusion in a Bertrand-Edgeworth Duopoly
Roberto Hernan González and
No 4564, Asociación Argentina de Economía Política: Working Papers from Asociación Argentina de Economía Política
List-pricing and discounting is a common practice in retail and wholesale markets. Under this pricing mechanism, a posted list price is offered to sellers in a prior stage which can then de discounted at a later in a second stage. The practice of list pricing and discounting is viewed as collusive theoretically, however, its interpretation amongst competition authorities varies from being pro-competitive to being a collusion facilitating device. We experimentally test how list pricing and discounting impact prices in a capacity constrained Bertrand-Edgeworth duopoly with symmetric and asymmetric firms. We find evidence of collusion under list pricing and discounting with symmetric as well as with asymmetric firms relative to a baseline case without the discounting stage.
JEL-codes: C9 L0 L1 L11 L13 L4 (search for similar items in EconPapers)
Pages: 30 pages
New Economics Papers: this item is included in nep-com, nep-ind and nep-reg
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed
Downloads: (external link)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:aep:anales:4564
Access Statistics for this paper
More papers in Asociación Argentina de Economía Política: Working Papers from Asociación Argentina de Economía Política Contact information at EDIRC.
Bibliographic data for series maintained by Juan Manuel Quintero ().