I study the problem of a durable goods monopolist who lacks commitment power and whose marginal cost of production varies stochastically over time. I show that a monopolist with stochastic costs usually serves the different types of consumers at different times and charges them different prices....

I study how the arrival of new private information affects bargaining outcomes. A seller makes offers to a buyer. The buyer is privately informed about her valuation and the seller privately observes her stochastically changing cost of delivering the good. Prices fall gradually at the early...