The Tragic Inefficiency Of the M-ECPR

Nicholas Economides ()

Working Papers from New York University, Leonard N. Stern School of Business, Department of Economics

Abstract: We show that application of the so-called "Market Determined Efficient Component Pricing Rule," the "Efficient Component Pricing Rule," and, in general, of pricing rules that are based on private opportunity costs would perpetuate pricing inefficiencies and result in lower social surplus than pricing which is based on social opportunity cost rather than private opportunity costs.

Keywords: Networks; Access; Complementarity; Public Policy (search for similar items in EconPapers)
JEL-codes: L13 L40 (search for similar items in EconPapers)
Date: 1997-12
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:ste:nystbu:98-01

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