IDEAS home Printed from https://ideas.repec.org/p/crs/wpaper/2016-24.html
   My bibliography  Save this paper

Obfuscation Incentives of a Monopoly in a Dynamic Framework

Author

Listed:
  • Arthur Cazaubiel

    (CREST)

Abstract

Obfuscation is a well-known strategy developed by ?rms to lower the intensity of competition. We develop here a theoretical framework extending this result to a monopoly controlling consumer’s search costs. In a dynamic structure where the future of the monopoly is today’s competitor, as phrased by Coase’s conjecture, obfuscating some products today turns clients into myopic consumers. This myopia generates higher pro?t through an optimal price discrimination. Introducing some correlation between the valuations of the goods, we are able to describe more complex but realistic equilibria. Interestingly, there exists a correlation value above which obfuscation is no longer pro?table.

Suggested Citation

  • Arthur Cazaubiel, 2016. "Obfuscation Incentives of a Monopoly in a Dynamic Framework," Working Papers 2016-24, Center for Research in Economics and Statistics.
    • Handle: RePEc:crs:wpaper:2016-24
    as

    Download full text from publisher

    File URL: http://crest.science/RePEc/wpstorage/2016-24.pdf
    File Function: Crest working paper version
    Download Restriction: no
    ---><---

    More about this item

    Keywords

    Coase’s conjecture; multiproduct-?rm; monopoly; obfuscation; intertemporal price discrimination; sequential search model;
    All these keywords.

    JEL classification:

    • L12 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Monopoly; Monopolization Strategies
    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • D42 - Microeconomics - - Market Structure, Pricing, and Design - - - Monopoly
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
    • D92 - Microeconomics - - Micro-Based Behavioral Economics - - - Intertemporal Firm Choice, Investment, Capacity, and Financing

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:crs:wpaper:2016-24. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Secretariat General (email available below). General contact details of provider: https://edirc.repec.org/data/crestfr.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.