No Picture

When is price discrimination from consumer data okay?

December 21, 2012 11:06 am Sasha_Romanosky 2
Price discrimination is the practice by which firms offer differential prices to customers, often based on some observed characteristic. Examples include discounts to students, the elderly, loyalty program members, bulk discounts, etc. There are different kinds of price discrimination and the extreme form (1st degree) amounts to the retailer charging the maximum amount that each customer is willing to pay, thereby extracting the greatest surplus.…