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Author: | Kuehn, K.-L. |
Title: | Intertemporal price discrimination in frictionless durable goods monopolies |
Journal: | Journal of Industrial Economics
1998 : MAR, VOL. 46:1, p. 101-114 |
Index terms: | PRICES DISCRIMINATION CONSUMER DURABLES |
Language: | eng |
Abstract: | The author shows that small differences in quality and production costs between durables and non-durables in a product line allow a durable goods monopolist to intertemporally price discriminate even with continuous trading. In particular, a monopolist would want to both sell and rent out a durable to achieve price discrimination. This incentive to price discriminate simultaneously creates inefficient delay in the sale of the durable good, a finite trading period and long run efficiency of the market. |
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