The Welfare Effects of Third Degree Price Discrimination in Intermediate Good Markets: The Case of Bargaining

By Obrien, Daniel P.

Book Id: WPLBN0000009069
Format Type: PDF eBook
File Size: 0.3 MB
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Title:	The Welfare Effects of Third Degree Price Discrimination in Intermediate Good Markets: The Case of Bargaining
Author:	Obrien, Daniel P.
Volume:
Language:	English
Subject:	Trade, Import and export controls, Federal Trade Commission (U.S.)
Collections:	Economics Publications Collection, Federal Trade Commission
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Publisher:	Government Printing Office


Citation APA MLA Chicago O'brien, D. P. (n.d.). The Welfare Effects of Third Degree Price Discrimination in Intermediate Good Markets: The Case of Bargaining. Retrieved from https://self.gutenberg.org/

Description
Government Reference Publication

Excerpt
This paper examines the welfare eects of third degree price dis- crimination by an intermediate good monopolist selling to downstream rms with bargaining power. One of the downstream rms (the \chain store) may have a greater ability than rivals to integrate backward into the supply of the input. In addition to this outside option, the rms' relative bargaining powers depend on their disagreement prof- its, bargaining weights, and concession costs. If the chain's integration threat is not a credible outside option, and if downstream rms can- not coordinate their bargaining strategies, then price discrimination reduces input prices to all downstream rms...