Efficient demands in a multi-product monopoly

• 成果类型: Article
• 署名作者: Yang, Kai Hao
• 署名单位: Yale University
• 刊物名称: JOURNAL OF ECONOMIC THEORY
• ISSN/ISSBN: 0022-0531
• DOI: 10.1016/j.jet.2021.105330
• 发表日期: 2021
• 关键词: Multi-product monopoly; Second-degree price discrimination; Upgrade markets; Efficient demand; Affine-unit-elastic demand; TECHNOLOGY

摘要

This paper characterizes the efficient market demands among those with a fixed surplus level in a multiproduct monopoly, where the monopolist is able to produce a continuum of quality-differentiated products with a cost function that is convex in quality. We show that any efficient market demand must be affineunit-elastic. This further reduces the problem of characterizing the efficient frontier to a finite dimensional constraint optimization problem. From this characterization, it follows that deadweight losses are positive even under efficient demands; that both consumer surplus and total welfare are nonmonotonic in cost; and that the monopolist sells at most two distinct quality levels under any efficient market demand. (C) 2021 Elsevier Inc. All rights reserved.