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To Abuse, or not to Abuse: Discrimination between Consumers

Author

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  • Pinar Akman

    (Centre for Competition Policy and School of Law, University of East Anglia)

Abstract

This paper questions whether discrimination between consumers by a dominant undertaking can and should constitute an abuse of a dominant position under Article 82EC. By finding that it can, the paper challenges the traditional interpretation of the discrimination ban under that provision, namely that discrimination constitutes abuse only when directed against the intermediate customers of the dominant undertaking. As such, the paper seeks to clarify the scope of Article 82EC as regards discrimination, and elaborate on whether discrimination between consumers should be abusive. This is done from both a law and an economics perspective, in order to put forward a proposal to ensure that competition law does not prohibit discrimination where economics finds it potentially welfare enhancing.

Suggested Citation

  • Pinar Akman, 2006. "To Abuse, or not to Abuse: Discrimination between Consumers," Working Paper series, University of East Anglia, Centre for Competition Policy (CCP) 2006-18, Centre for Competition Policy, University of East Anglia, Norwich, UK..
    • Handle: RePEc:uea:ueaccp:2006_18
    as

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    References listed on IDEAS

    as
    1. Ernst Fehr & Klaus M. Schmidt, 1999. "A Theory of Fairness, Competition, and Cooperation," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 114(3), pages 817-868.
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    4. Schmalensee, Richard, 1981. "Output and Welfare Implications of Monopolistic Third-Degree Price Discrimination," American Economic Review, American Economic Association, vol. 71(1), pages 242-247, March.
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    6. Varian, Hal R, 1985. "Price Discrimination and Social Welfare," American Economic Review, American Economic Association, vol. 75(4), pages 870-875, September.
    7. O'Brien, Daniel P & Shaffer, Greg, 1994. "The Welfare Effects of Forbidding Discriminatory Discounts: A Secondary Line Analysis of Robinson-Patman," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 10(2), pages 296-318, October.
    8. Rabin, Matthew, 1993. "Incorporating Fairness into Game Theory and Economics," American Economic Review, American Economic Association, vol. 83(5), pages 1281-1302, December.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Abuse of dominant position; (price) discrimination; consumer welfare;
    All these keywords.

    JEL classification:

    • K21 - Law and Economics - - Regulation and Business Law - - - Antitrust Law

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