Economics, Econometrics and Finance
8 years ago

Monopoly market profit maximized by exploiting consumer switching costs.

Industrial Engineering and Engineering Management
Third Degree Price Discrimination with Customer Switching Costs
LI Huai-zu

Paper Summary

The article looks at how companies can make the most money in a market where customers might switch to different brands. They study how setting different prices for different customers can affect profits, prices, and sales. The results depend on how much customers want the product and how much it costs to make.

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