Talk:Price discrimination
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Piracy - there isn't a discussion about producers of, for instance, branded, or copyrighted articles pirating their own goods in order to effect price discrimination. Could someone take up the gauntlet?
Patrick, again I wish to take issue with your correction. We know from economics 101 that total revenue is equal to quantity sold times the price. The quantity sold in the second market is 0,Q2 The price in that maket is 0,P2 The total revenue is 0, P2, C, Q2 . You seem to be saying that the amount sold in that market is Q1, Q2 . It is not. You measure from the axis, not from an arbitrary point on the axis. The fact that say 100 units is sold to market 1 does not influence the fact that say 300 units is sold in market 2. - - user:mydogategodshat
Come to think about it, you might be right. Let me think about this for a moment maydogategodshat
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If my original area is right, the double counting from multiple pricings would increase revenue exponentially. I think you are right. I had better change the lettering on the diagram. mydogategodshat
- People are willing to pay P2 or more for an amount Q2. Of this, an amount Q1 can be sold for P1, for the remaining Q2-Q1 a price of P2 is set. - Patrick 02:27 30 Jun 2003 (UTC)
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[edit] What? No mention of...
Adult/child rates on public transport and tourist attractions - this is perhaps the most obvious example of price discrimination at least here in Britain. Sometimes there are also rates for students, senior citizens, unemployed, disabled....
- That sounds like dual pricing, and I think those are more common examples then what's in that section now.Seano1 22:24, 21 Jan 2005 (UTC)
Insurance - this is also a common context of price discrimination over here. Age, gender, geographical location, whether you've made a claim before....
- I think those could be justified by the extra cost of paying out claims to hinger risk costumers. Seano1 22:24, 21 Jan 2005 (UTC)
Hairdressers - I've noticed a lot charge women more than men. Regardless of how much hair they have to start with or how short they want it cut.
-- Smjg 10:52, 20 Dec 2004 (UTC)
[edit] Where is the wage discrimination article?
We currently have no article on wage discrimination. As it is just a subset of price discrimination, it could be made as a redirect here, or as its own article. For now, I'm just gonna create a redirect here, and add some stubby stuff on it to this article. Intangir 20:21, 4 December 2005 (UTC)
[edit] Bundling
Probably want to add some info on bundling too.
Feinstein 23:03, 19 December 2005 (UTC)
Bundling is far too difficult for a simple article. John wesley 19:05, 6 April 2006 (UTC)
[edit] Convergence of Financial Aid in Education and Dual Pricing
Of course, another example of dual pricing takes place within otherwise undiscounted pricing of education, as in-state and in-country students pay less for the same product (courses). Viewed from the out-of-state student's perspective, this is pure dual pricing; viewed from the legislature's perspective, it may be at least intended as investment in the state's future. Viewed as a business practice example, it is almost as capricious as airline pricing--and fully as entangled in regulation, political finagling, and sleight of hand.
This is probably the wrong venue to inveigh against present and forseeable trends in college tuition pricing with respect to that state's future. However, I think that the "does a good job" characterization regarding setting prices is increasingly inaccurate as access to advanced schooling for those with potential but without resources is increasingly squeezed. An ABD quoted to me a memo "accidentally" seen by grad students at his school and stating that the school should no longer be viewed as available to the poor. Explicit confirmation of what is suspected can be as traumatic as constant worry...
LateDave 20060707
[edit] Airlines and price discrimination
The article states that airlines get away with price discrimination because of "market frictions in oligopolies". But is't the reason rather that usually a name change is not allowed (or practically ruled out by high charges)? And because you have to prove your identity (for security reasons) before boarding, you cannot use a ticket someone else sold to you. However, I am neither sure nor an expert on the matter.
[edit] Another example
I've found another example of price discrimination: smokers and older people have to pay more for life insurance. Scott Gall 10:42, 9 March 2007 (UTC)
- This is not price discrimination but merely a reflection of the fact that older people have a higher risk of dying than younger people. This is completely different than price discrimination in an economics sense. --131.194.93.95 18:42, 1 May 2007 (UTC)
The price discrimination that benefits to women in night clubs is also practiced in Europe and probably all around the world, so this example is a worldwide view of the topic, I think. —Preceding unsigned comment added by 86.67.247.142 (talk) 23:41, 8 November 2007 (UTC)
[edit] Drugs sold in foreign markets
Would the different prices that drug companies charge different markets count as price discrimination? I think I read an article about Abbott charging higher prices in the US to make up for its lower prices in Thailand (which it was practically forced to charge due to their willingness to break patent laws to import or create cheap generic copies of patented drugs, especially AIDS medication).
If you are a Wall Street Journal Subscriber there is an article here:
- I haven't seen the article above, but yes, drug prices is a classic case of price discrimination. The economic description is usually more specific than the vague "charging higher prices in market A to make up for low prices in market B." The economic profit decision is more straightforward: maximise profits in market A by charging the price that produces maximum revenue (this will depend on ability to pay, price elasticity, etc); repeat for markets B to Z. The profit-maximising incentive has nothing to do with "making up" for prices elsewhere.
- To rephrase in English: buyers in rich markets will buy X units at $50 each, but lowering the price to $25 does not double sales (for example); in poor markets, however, none will be sold at all at prices higher than $10 (whether this is because of weak patent laws or generics or simply ability to pay). So (assuming the cost of production is less than $10, say $2 per unit) the choice is simple: if you can, sell at $50 in rich markets, and $10 in poor markets. You might change the name or formulation slightly to prevent trading/arbitrage between markets. Or you might press for greater patent protection; in theory, not necessarily to increase prices in the poor markets - it could be to protect margins in the rich markets.--Gregalton 09:25, 1 June 2007 (UTC)
- An additional note on this: if the ability to price discriminate does not exist in the (hypothetical) example, the vendor may find that the revenue-maximising optimum is to continue to charge $50/unit, and the result is that none are sold in the poor markets. This would occur if the additional profits to be made from the poor market are too small to compensate for the lost profits by lowering prices in the rich country.
- The usual economic analysis is that everyone gains: more units are sold, more consumers who want/need the medicine can afford to buy it, the producer makes more profit. The key issue for drugs is whether the weasel phrase "'more' consumers who want/need the medicine" sufficiently expresses the range of outcomes (hardship, both medical and financial) possible in this dry analysis.
- Two key points: a) without a monopoly (patent protection) the price discrimination issue is very different (competitors could undercut the price in all markets); and b) the usual justification is that without this monopoly (and the potential for super-profits monopoly power confers) the drugs would not exist in the first place.--Gregalton 06:41, 4 June 2007 (UTC)
[edit] Why does 'price targeting' redirect here?
I'm not aware that the two are synonyms. Can someone provide references for this? If they are synonyms, both words should be mentioned in the definition at the beginning. --Rinconsoleao (talk) 14:51, 18 December 2007 (UTC)
[edit] DVD Regional Coding
Shouldn't there be something on this, and how it enables price discrimination, since it prevents an entirely free market. --J.StuartClarke (talk) 03:43, 9 January 2008 (UTC)
