THE DEFENSE OF PRICE DISCRIMINATION IN NETWORK AND INFORMATION GOODS MARKETS

Kód výsledku v IS VaVaI

<a href="https://www.isvavai.cz/riv?ss=detail&h=RIV%2F62690094%3A18450%2F21%3A50019008" target="_blank" >RIV/62690094:18450/21:50019008 - isvavai.cz</a>

Výsledek na webu

<a href="https://dspace5.zcu.cz/bitstream/11025/46496/1/EM_4_2021_03.pdf" target="_blank" >https://dspace5.zcu.cz/bitstream/11025/46496/1/EM_4_2021_03.pdf</a>

DOI - Digital Object Identifier

<a href="http://dx.doi.org/10.15240/tul/001/2021-4-003" target="_blank" >10.15240/tul/001/2021-4-003</a>

Jazyk výsledku

angličtina

Název v původním jazyce

THE DEFENSE OF PRICE DISCRIMINATION IN NETWORK AND INFORMATION GOODS MARKETS

Popis výsledku v původním jazyce

It is not uncommon that articles focused on consumer-price interaction in the network and information goods market swiftly condemn price discrimination as an obfuscation, on-purpose price complexity, or market failure. The reason is a general neoclassical rule of an efficient market where prices are set at marginal cost with no price discrimination. However, the matter is more complicated. This review provides authors an overview of why, where, and which type of price discrimination should be viewed by different optics. Goods such as software, cell carrier services, electronic newspapers subscription, electric energy supply, payment accounts, books, copyrighted content streaming, etc, cannot be treated like manufactured goods. The reasons are specific conditions - substantial and/or repeated fixed/sunk cost, economies of scale, and demand heterogeneity. Recognized economist W. J. Baumol described marginal cost set prices under these conditions as an &apos;economic suicide&apos;. Reviewed articles showed that firms are forced to adopt price discrimination in order to recover their costs and to serve more consumer segments. Reviewed authors provided facts to support the use of multipart tariffs, dynamic pricing, versioning, bundling, and Ramsey pricing. These conclusions are used for suggestions on how several studies of information and network goods should be modified. Modifications are related mostly to model assumptions and pricing conclusions. I argue that, in the case of information and network goods, there is justified price discrimination. Hence, there is a certain justified level of price complexity that has to be accepted and not taken as automated evidence of inefficiency, market power, and consumer exploitation.

Název v anglickém jazyce

THE DEFENSE OF PRICE DISCRIMINATION IN NETWORK AND INFORMATION GOODS MARKETS

Popis výsledku anglicky

It is not uncommon that articles focused on consumer-price interaction in the network and information goods market swiftly condemn price discrimination as an obfuscation, on-purpose price complexity, or market failure. The reason is a general neoclassical rule of an efficient market where prices are set at marginal cost with no price discrimination. However, the matter is more complicated. This review provides authors an overview of why, where, and which type of price discrimination should be viewed by different optics. Goods such as software, cell carrier services, electronic newspapers subscription, electric energy supply, payment accounts, books, copyrighted content streaming, etc, cannot be treated like manufactured goods. The reasons are specific conditions - substantial and/or repeated fixed/sunk cost, economies of scale, and demand heterogeneity. Recognized economist W. J. Baumol described marginal cost set prices under these conditions as an &apos;economic suicide&apos;. Reviewed articles showed that firms are forced to adopt price discrimination in order to recover their costs and to serve more consumer segments. Reviewed authors provided facts to support the use of multipart tariffs, dynamic pricing, versioning, bundling, and Ramsey pricing. These conclusions are used for suggestions on how several studies of information and network goods should be modified. Modifications are related mostly to model assumptions and pricing conclusions. I argue that, in the case of information and network goods, there is justified price discrimination. Hence, there is a certain justified level of price complexity that has to be accepted and not taken as automated evidence of inefficiency, market power, and consumer exploitation.

Druh

J_imp - Článek v periodiku v databázi Web of Science

CEP obor

—

OECD FORD obor

50201 - Economic Theory

Projekt

—

Návaznosti

I - Institucionalni podpora na dlouhodoby koncepcni rozvoj vyzkumne organizace

Rok uplatnění

2021

Kód důvěrnosti údajů

S - Úplné a pravdivé údaje o projektu nepodléhají ochraně podle zvláštních právních předpisů

Název periodika

E &amp; M EKONOMIE A MANAGEMENT

ISSN

1212-3609

e-ISSN

—

Svazek periodika

24

Číslo periodika v rámci svazku

4

Stát vydavatele periodika

CZ - Česká republika

Počet stran výsledku

17

Strana od-do

39-55

Kód UT WoS článku

000733816600003

EID výsledku v databázi Scopus

2-s2.0-85122189888