Competition and price discrimination in the market for mailing lists

Ron Borzekowski, Charles Taragin and Raphael Thomadsen
Additional contact information
Charles Taragin: https://www.federalreserve.gov/econres/charles-s-taragin.htm

No 2005-56, Finance and Economics Discussion Series from Board of Governors of the Federal Reserve System (U.S.)

Abstract: This paper examines the relationship between competition and price discrimination in the market for mailing lists. More specifically, we examine whether sellers are more likely to segregate consumers by offering a menu of quality choices (second-degree price discrimination) and/or offering different prices to readily identifiable groups of consumers (third-degree price discrimination) in more competitive markets. We also examine how the fineness with which consumers are divided corresponds to the level of competition in the market. ; The dataset includes information about all consumer response lists derived from mail order buyers (i.e. lists derived from catalogs) available for rental in 1997 and 2002. Using industry classifications, we create measures of competition for each list. We then use these measures to predict whether given lists utilize discriminatory pricing strategies. ; Our results indicate that lists facing more competition are more likely to implement second-degree and third-degree price discrimination, and when implementing second-degree price discrimination, to offer menus with more choices.

Keywords: Price discrimination; Mailing list services industry (search for similar items in EconPapers)
Date: 2005
New Economics Papers: this item is included in nep-com, nep-ind, nep-mic and nep-mkt
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Citations: View citations in EconPapers (2)

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Related works:
Journal Article: Competition and price discrimination in the market for mailing lists (2009)
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