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dc.contributor.authorJensen, Sissel
dc.date.accessioned2006-08-04T08:13:49Z
dc.date.available2006-08-04T08:13:49Z
dc.date.issued2001
dc.identifier.issn0804-6824
dc.identifier.urihttp://hdl.handle.net/11250/162838
dc.descriptionUpdated August 2004en
dc.description.abstractWhen a firm operates in an industry with very large differences in consumers' willingness to pay for the service it offers, it faces a challenge in the pricing decision. It wants to engage in price discrimination, but cannot identify a given consumer's market segment ex ante. When consumers' willingness to pay is private information, a widely used sorting mechanism is to offer a menu of two part tariffs, letting high demand and low demand consumers self-select into distinct market segments by their tariff choice. However, when the difference in consumers' willingness to pay is very large, simple two part tariffs are not longer sufficient to discriminate between high and low demand segments; Despite the ability to price discriminate, the firm still prefers to serve high demand consumers only. The model suggests that it might be possible to discriminate between consumers by other means than price-cost distortions; Low demand consumers face a two part tariff with a per unit price possibly above marginal cost, together with a restriction on usage, whereas high demand consumers face an efficient two part tariff.en
dc.format.extent251560 bytes
dc.format.mimetypeapplication/pdf
dc.language.isoengen
dc.publisherNorwegian School of Economics and Business Administration. Department of Economicsen
dc.relation.ispartofseriesDiscussion paperen
dc.relation.ispartofseries2001:19en
dc.subjectprice discriminationen
dc.subjecttwo part tariffsen
dc.subjectquantity discountsen
dc.subjecttelecommunicationsen
dc.titleTwo part tariffs with partial product bundlingen
dc.typeWorking paperen


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