Optimal second-degree price discrimination and arbitrage: On the role of asymetric information among buyers
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- dc.contributor.author Jeon, Doh-Shinca
- dc.contributor.author Menicucci, Domenicoca
- 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.date.modified 2017-07-23T02:06:54Z
- 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/pdfca
- 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.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.accessRights info:eu-repo/semantics/openAccess
- dc.rights.uri http://creativecommons.org/licenses/by-nc-nd/3.0/es/
- 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.title Optimal second-degree price discrimination and arbitrage: On the role of asymetric information among buyersca
- dc.type info:eu-repo/semantics/workingPaper