Hassle Costs and Price Discrimination: An Empirical Welfare Analysis

• 成果类型: Article
• 署名作者: Marshall, Guillermo
• 署名单位: University of Illinois System; University of Illinois Urbana-Champaign
• 刊物名称: AMERICAN ECONOMIC JOURNAL-APPLIED ECONOMICS
• ISSN/ISSBN: 1945-7782
• DOI: 10.1257/app.20130046
• 发表日期: 2015
• 页码: 123-146
• 关键词: competition; BEHAVIOR; models; GOODS; LAW

摘要

This paper studies a market where soda is sold in both refillable and nonrefillable bottles. Purchasing refillables is inconvenient but cheaper. Using a discrete choice model, I find that price-sensitive customers put less weight on the inconveniences of purchasing refillables. This implies that a retailer can target lower prices to price-sensitive customers using the refillable segment. I evaluate the overall welfare consequences of this market segmentation and find that both customer welfare and profits would decrease (by 12.61 and 4.21 percent, respectively) if the refillables were removed, as there would be an important market-shrinkage effect.