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Incomplete third-degree price discrimination, and market partition problem

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  • Yann Braouezec

    (ESILV)

Abstract

We introduce in this paper the "incomplete" third-degree price discrimination, which is the situation where a monopolist must charge at most k different prices while the total market is composed of n markets, with n>k. We thus study the optimal partition problem of the n markets in k groups. As a byproduct, when k=2, we are able to reconsider the so-called (Robinsonian) weak-strong partition.

Suggested Citation

  • Yann Braouezec, 2009. "Incomplete third-degree price discrimination, and market partition problem," Economics Bulletin, AccessEcon, vol. 29(4), pages 2908-2917.
    • Handle: RePEc:ebl:ecbull:eb-09-00580
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    References listed on IDEAS

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    More about this item

    Keywords

    Price discrimination; monopoly; decentralized decision process; optimal partition problem; profit maximization;
    All these keywords.

    JEL classification:

    • L0 - Industrial Organization - - General
    • L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance

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