Intertemporal price discrimination: dynamic arrivals and changing values

Daniel Garrett

No 16-679, TSE Working Papers from Toulouse School of Economics (TSE)

Abstract: We study the profit-maximizing price path of a monopolist selling a durable good to buyers who arrive over time and whose values for the good evolve stochastically. The setting is completely stationary with an infinite horizon. Contrary to the case with constant values, optimal prices fluctuate with time. We argue that consumers'randomly changing values offer an explanation for temporary price reductions that are often observed in practice.

JEL-codes: D82 L12 (search for similar items in EconPapers)
Date: 2016-07
New Economics Papers: this item is included in nep-com, nep-mic and nep-mkt
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (41)

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Related works:
Journal Article: Intertemporal Price Discrimination: Dynamic Arrivals and Changing Values (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:tse:wpaper:30568

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