Econometrica: Nov 1984, Volume 52, Issue 6
Price Discrimination and Monopolistic Competition
Michael L. KatzI examine the effects of price discrimination on the equilibrium prices, number of firms, and level of total surplus in a monopolistically competitive market. The main finding is that uniform pricing is more (less) efficient than is price discrimination when the purchases made by the consumers who are discriminated against constitute a small (large) proportion of the total purchases.
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