Spatial Price Discrimination in Input Markets with an Endogenous Market Boundary

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Title:	Spatial Price Discrimination in Input Markets with an Endogenous Market Boundary
Authors:	Chen, Chin-Sheng Hwang, Hong
Contributors:	國貿系
Keywords:	Endogenous market boundary Input price discrimination Spatial price discrimination Third-degree price discrimination
Date:	2014-09
Issue Date:	2015-01-20 15:49:32 (UTC+8)
Abstract:	This paper examines the welfare effect of third-degree price discrimination in a vertically related market with one upstream monopolist that sells its input to a continuum of downstream markets. Assume that the market boundary of the monopolist is endogenously determined. It is found that social welfare is necessarily lower under discriminatory than uniform pricing, even if the market area of the former is greater than that of the latter. This finding is contrary to that in the extant literature on price discrimination in final goods markets.
Relation:	REVIEW OF INDUSTRIAL ORGANIZATION 卷: 45 期: 2 頁碼: 139-152
Appears in Collections:	[Department of International Trade 7 Graduate Institute of International Trade ] periodical articles

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