Price Discrimination

Abishek Monga | Aanchal Adlakha | Bharat Rishi | Syed Moizuddin | Sahil Sareen | Sahil Singhal

Charging Different For Same Goods/Service Vegetable Vendor Frequent Flyer Ladies Night

Monuments Tickets
Railway Tickets College Fee Structure

Basics

 Charging Different For Same Goods/Service Conditions Types Special Features Effects Legal Status

Ahead

 Monopoly and Oligopoly type markets Market Power Identify Markets

Low Cost of Market Differentiation

Conditions

 To Capture Consumer Surplus and maximize producer surplus To Maximize profit To Recover Supply Cost

Reasons for existence

 First Degree Second Degree Third Degree

Types

Consumer Surplus

Price Dependent on the Will/Ability Partially Theoretical Consumer Surplus

0 P1

MC

ATC

`
Q1 Quantity

Maximum Gains

First degree

 Different Price for Different Quantity

MC

`
Charging Different Consumers Different Wholesale market, End of Season Sales
P1 P2

Q1 Quantity

Q2

Second Degree

 Grouping Consumers

Elasticity Check
Electricity Bills, Railway Fares, Hotels Separate Price Range

Third Degree

 Not Mutually Exclusive

Two Part Tariff Strict Avoidance of Resell Rate fence

Special Features

 Racial Practices

Economic Welfare
Social Welfare

Effects

 Ban For Discrimination No Blanket Loop holes and Wide Practice

Legal