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American Economic Review: Vol. 100 No. 4 (September 2010)


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Monopoly Price Discrimination and Demand Curvature

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Aguirre, Iñaki, Simon Cowan, and John Vickers. 2010. "Monopoly Price Discrimination and Demand Curvature." American Economic Review, 100(4): 1601-15.

DOI: 10.1257/aer.100.4.1601


This paper presents a general analysis of the effects of monopolistic third-degree price discrimination on welfare and output when all markets are served. Sufficient conditions — involving straightforward comparisons of the curvatures of the direct and inverse demand functions in the different markets — are presented for discrimination to have negative or positive effects on social welfare and output. (JEL D42)

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Aguirre, Iñaki (U Basque Country)
Cowan, Simon (U Oxford)
Vickers, John (All Souls College, U Oxford)

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D42: Market Structure and Pricing: Monopoly

American Economic Review

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