Third-degree Price Discrimination
نویسندگان
چکیده
IN THE LITERATURE OF monopolistic third-degree price discrimination, it has been widely held that a change in aggregate Marshallian social welfare by price discrimination is negative if total output decreases. Among others, Schwartz [1990] verifies this conjecture for any total cost function that depends only on total output, not on its distribution among markets. Letting ∆X and ∆W denote a change in aggregate output and in social welfare, respectively, we can express his argument as follows:
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