A note on dynamic monopoly pricing under consumption externalities

Kaito Hashimoto; Nobuo Matsubayashi

doi:10.1016/j.econlet.2014.04.007

A note on dynamic monopoly pricing under consumption externalities

Kaito Hashimoto, Nobuo Matsubayashi

Department of Industrial and Systems Engineering

Research output: Contribution to journal › Article › peer-review

4 Citations (Scopus)

Abstract

We analyze dynamic monopoly pricing under consumption externalities, focusing on pricing under negative externalities. We also attempt to generalize models in the previous literature, which encompass both negative and positive externalities, by incorporating a consumer's discount factor for past sales as a parameter. Analyzing our model reveals oscillation as the optimal price path in the presence of negative externalities.

Original language	English
Pages (from-to)	1-8
Number of pages	8
Journal	Economics Letters
Volume	124
Issue number	1
DOIs	https://doi.org/10.1016/j.econlet.2014.04.007
Publication status	Published - 2014 Jul

Keywords

Congestion pricing
Consumption externalities
Monopoly pricing
Snob effect

ASJC Scopus subject areas

Finance
Economics and Econometrics

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10.1016/j.econlet.2014.04.007

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title = "A note on dynamic monopoly pricing under consumption externalities",

abstract = "We analyze dynamic monopoly pricing under consumption externalities, focusing on pricing under negative externalities. We also attempt to generalize models in the previous literature, which encompass both negative and positive externalities, by incorporating a consumer's discount factor for past sales as a parameter. Analyzing our model reveals oscillation as the optimal price path in the presence of negative externalities.",

keywords = "Congestion pricing, Consumption externalities, Monopoly pricing, Snob effect",

author = "Kaito Hashimoto and Nobuo Matsubayashi",

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AB - We analyze dynamic monopoly pricing under consumption externalities, focusing on pricing under negative externalities. We also attempt to generalize models in the previous literature, which encompass both negative and positive externalities, by incorporating a consumer's discount factor for past sales as a parameter. Analyzing our model reveals oscillation as the optimal price path in the presence of negative externalities.

KW - Congestion pricing

KW - Consumption externalities

KW - Monopoly pricing

KW - Snob effect

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A note on dynamic monopoly pricing under consumption externalities

Abstract

Keywords

ASJC Scopus subject areas

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