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Optimal second-degree price discrimination and arbitrage: On the role of asymetric information among buyers

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dc.contributor.author Jeon, Doh-Shin
dc.contributor.author Menicucci, Domenico
dc.contributor.other Universitat Pompeu Fabra. Departament d'Economia i Empresa
dc.date.accessioned 2017-07-26T10:50:22Z
dc.date.available 2017-07-26T10:50:22Z
dc.date.issued 2001-11-01
dc.identifier https://econ-papers.upf.edu/ca/paper.php?id=624
dc.identifier.citation Rand Journal of Economics, vol. 36 (2), 337-360, Summer 2005
dc.identifier.uri http://hdl.handle.net/10230/677
dc.description.abstract The traditional theory of monopolistic screening tackles individual self-selection but does not address the possibility that buyers could form a coalition to coordinate their purchases and to reallocate the goods. In this paper, we design the optimal sale mechanism which takes into account both individual and coalition incentive compatibility focusing on the role of asymmetric information among buyers. We show that when a coalition of buyers is formed under asymmetric information, the monopolist can do as well as when there is no coalition. Although in the optimal sale mechanism marginal rates of substitution are not equalized across buyers (hence there exists room for arbitrage), they fail to realize the gains from arbitrage because of the transaction costs in coalition formation generated by asymmetric information.
dc.format.mimetype application/pdf
dc.language.iso eng
dc.relation.ispartofseries Economics and Business Working Papers Series; 624
dc.rights L'accés als continguts d'aquest document queda condicionat a l'acceptació de les condicions d'ús establertes per la següent llicència Creative Commons
dc.rights.uri http://creativecommons.org/licenses/by-nc-nd/3.0/es/
dc.title Optimal second-degree price discrimination and arbitrage: On the role of asymetric information among buyers
dc.type info:eu-repo/semantics/workingPaper
dc.date.modified 2017-07-23T02:06:54Z
dc.subject.keyword monopolistic screening
dc.subject.keyword coalition incentive compatibility
dc.subject.keyword asymetric information
dc.subject.keyword transaction costs
dc.subject.keyword Microeconomics
dc.rights.accessRights info:eu-repo/semantics/openAccess


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