Abstract
Price discrimination occurs when the prices of similar products sold by the same firm show variation that cannot be attributed to cost variation. Recent empirical work has identified the presence of both direct and indirect price discrimination, after cost-based explanations have been accounted for. Furthermore, there is increasing evidence on the sources of price discrimination. The extent of price discrimination has often been found to increase as competition intensifies, in contrast to conventional wisdom but consistent with new theoretical insights. Finally, various empirical studies have considered the effects of price discrimination on profits, consumer welfare and efficiency.
This chapter was originally published in The New Palgrave Dictionary of Economics, 2nd edition, 2008. Edited by Steven N. Durlauf and Lawrence E. Blume
Bibliography
Asplund, M., R. Erikkson, and N. Strand. 2002. Price discrimination in oligopoly: Evidence from Swedish newspapers. Discussion paper no. 3269. London: CEPR.
Benston, G. 1964. Commercial bank price discrimination against small loans: An empirical study. Journal of Finance 19: 631–643.
Besanko, D., J.-P. Dubé, and S. Gupta. 2003. Competitive price discrimination strategies in a vertical channel using aggregate retail data. Management Science 49: 1121–1138.
Borenstein, S. 1991. Selling costs and switching costs: Explaining retail gasoline margins. RAND Journal of Economics 22: 354–369.
Borenstein, S., and N. Rose. 1994. Competition and price dispersion in the U.S. airline industry. Journal of Political Economy 102: 653–683.
Busse, M., and M. Rysman. 2005. Competition and price discrimination in Yellow Pages advertising. RAND Journal of Economics 36: 378–390.
Brenkers, R., and F. Verboven. 2006. Liberalizing a distribution system: The European car market. Journal of the European Economic Association 4: 216–251.
Clerides, S. 2002. Book value: Intertemporal pricing and quality discrimination in the U.S. market for books. International Journal of Industrial Organization 20: 1358–1408.
Clerides, S. 2004. Price discrimination with differentiated products: Definition and identification. Economic Inquiry 42: 402–412.
Crawford, G., and M. Shum. 2007. Monopoly quality degradation and regulation in cable television. Journal of Law and Economics 50: 181–219.
Degryse, H., and S. Ongena. 2005. Distance, lending relationships and competition. Journal of Finance 60: 231–236.
Goldberg, P., and F. Verboven. 2001. The evolution of price dispersion in the European car market. Review of Economic Studies 68: 811–848.
Graddy, K. 1995. Testing for imperfect competition at the Fulton fish market. RAND Journal of Economics 26: 75–92.
Leslie, P. 2004. Price discrimination in Broadway theatre. RAND Journal of Economics 35: 520–541.
Lott, J., and R. Roberts. 1991. A guide to the pitfalls of identifying price discrimination. Economic Inquiry 29: 14–23.
McManus, B. 2004. Nonlinear pricing in an oligopoly market: The case of specialty coffee. Mimeo. Olin School of Business, Washington University.
Miravete, E., and L. Roller. 2003. Competitive nonlinear pricing in duopoly equilibrium: The early U.S. cellular telephone industry. Discussion paper no. 4069. London: CEPR.
Nevo, A., and C. Wolfram. 2002. Why do manufacturers issue coupons? An empirical analysis of breakfast cereals. RAND Journal of Economics 33: 319–339.
Scherer, F., and D. Ross. 1990. Industrial market structure and economic performance. Boston: Houghton Mifflin Company.
Shepard, A. 1991. Price discrimination and retail configuration. Journal of Political Economy 99: 30–53.
Verboven, F. 1999. Brand rivalry and market segmentation, with an application to the pricing of optional engine power on automobiles. Journal of Industrial Economics 47: 399–425.
Verboven, F. 2002. Quality-based price discrimination and tax incidence – The market for gasoline and diesel cars in Europe. RAND Journal of Economics 33: 275–297.
Author information
Authors and Affiliations
Editor information
Editors and Affiliations
Copyright information
© 2008 The Author(s)
About this entry
Cite this entry
Verboven, F. (2008). Price Discrimination (Empirical Studies). In: The New Palgrave Dictionary of Economics. Palgrave Macmillan, London. https://doi.org/10.1057/978-1-349-95121-5_2256-1
Download citation
DOI: https://doi.org/10.1057/978-1-349-95121-5_2256-1
Received:
Accepted:
Published:
Publisher Name: Palgrave Macmillan, London
Online ISBN: 978-1-349-95121-5
eBook Packages: Springer Reference Economics and FinanceReference Module Humanities and Social SciencesReference Module Business, Economics and Social Sciences