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Recent developments in information technology (IT) have resulted in the collection of a vast amount of customer specific data. As the IT advances the quality of such information improves. We analyze a sequential spatial model of oligopolistic third degree price discrimination where the firms use...
Persistent link: https://www.econbiz.de/10005561388
We investigate how the endogenous acquisition of information, of a certain quality level, on consumers' willingness to pay (location) affects the equilibrium prices and welfare in a spatial price discrimination model. By varying the information quality we are able to obtain the equilibrium in...
Persistent link: https://www.econbiz.de/10005561406
We look at the incentives of two firms, who produce horizontally differentiated products, to acquire information of a certain quality on consumer willingness to pay. A firm who possesses such information can offer its product to different consumer groups at different prices (third degree price...
Persistent link: https://www.econbiz.de/10005561417
We examine the profitability and the welfare implications of price discrimination in two-sided markets. Platforms have information about the preferences of the agents that allows them to price discriminate within each group. The conventional wisdom from one-sided horizontally differentiated...
Persistent link: https://www.econbiz.de/10005622766
Persistent link: https://www.econbiz.de/10005816355
The recent literature on oligopolistic third-degree price discrimination has been primarily concerned with rival firms' incentives to acquire customer-specific information and the consequences of such information on firm profitability and welfare. This literature has taken mostly a static view...
Persistent link: https://www.econbiz.de/10012734288
We introduce a flexible framework by modeling the information firms possess about consumers' locations (preferences) on the Salop circle as a partition. Higher information quality is translated into a partition refinement. In the limit, we obtain the perfect price discrimination paradigm. We...
Persistent link: https://www.econbiz.de/10012737215
We examine the profitability and welfare implications of targeted price discrimination in two-sided markets. First, we show that equilibrium discriminatory prices exhibit novel features relative to discriminatory prices in one-sided models and uniform prices in two-sided models. Second, we...
Persistent link: https://www.econbiz.de/10012712926
We investigate the effect of competition on price dispersion in the airline industry. Using panel data from 1993 to 2008, we find a non-monotonic effect of competition on price dispersion. An increase in competition is associated with greater price dispersion in concentrated markets but is...
Persistent link: https://www.econbiz.de/10012713310
We introduce a flexible third-degree price discrimination framework by modeling the information firms possess about consumers' locations (preferences) on the Salop circle as a partition. Higher information quality is translated into a partition refinement. In the limit, we obtain the perfect...
Persistent link: https://www.econbiz.de/10014061086