Title: Bertrand Competition with an Asymmetric No-discrimination Constraint. Bruges European Economic Research (BEER) 23/June 2012
Abstract: Regulators and competition authorities often prevent firms with significant market power or dominant firms from practicing price discrimination. The goal of such an asymmetric no- discrimination constraint is to encourage entry and serve consumers’ interests. This constraint prohibits the firm with significant market power to practice both behaviour-based price discrimination within the competitive segment and third-degree price discrimination across the monopolistic and competitive segments. We find that this constraint hinders entry and reduces welfare when the monopolistic segment is small.
Publication Year: 2012
Publication Date: 2012-06-01
Language: en
Type: article
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