Econometrica: May, 1985, Volume 53, Issue 3

Capacity Pricing

https://doi.org/0012-9682(198505)53:3<545:CP>2.0.CO;2-Q
p. 545-566

Robert Wilson, Shmuel Oren, Stephen Smith

We study the problem of optimal pricing for a bundle of services characterized by two attributes (e.g., quantity and quality) and subject to capacity limitations or peakloading. An application is to services that take the form of a load-duration curve. Using separability assumptions on the demand and cost functions, we derive the optimal pricing policy for a monopolist seller. An example is solved completely.

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At their 2022 August EC meeting, the Executive Committee of the Econometric Society decided to bring a Data Editor onto the editorial boards of Econometrica, Quantitative Economics and Theoretical Economics. The Society is excited to announce that Joan Llull and his established team will be starting July 1, 2023 as the Society’s first Data Editor. He will bring extensive experience having been Data Editor for the Royal Economic Society and their two journals, the Economic Journal and the Econometrics Journal.

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