Uniform Pricing as a Barrier to Entry

A-Tier
Journal: Journal of Industrial Economics
Year: 2023
Volume: 71
Issue: 1
Pages: 176-191

Score contribution per author:

1.341 = (α=2.01 / 3 authors) × 2.0x A-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

This paper considers an entry game in which an incumbent firm operates in a number of markets and a potential entrant can enter multiple or all of the markets. While price discrimination has usually been thought of as a barrier to entry, in our model it is not and instead, charging a uniform price across the markets can discourage entry. Partial entry occurs when the two firms' products are highly substitutable. In this case, uniform pricing raises the profits of both the incumbent and the entrant but reduces consumer and total welfare relative to price discrimination.

Technical Details

RePEc Handle
repec:bla:jindec:v:71:y:2023:i:1:p:176-191
Journal Field
Industrial Organization
Author Count
3
Added to Database
2026-01-25