On the uniqueness of optimal prices set by monopolistic sellers

Gerard J. van den Berg

doi:10.1016/j.jeconom.2006.10.005

On the uniqueness of optimal prices set by monopolistic sellers

Gerard J. van den Berg^*

^*Corresponding author for this work

School of Economics

Research output: Contribution to journal › Article (Academic Journal) › peer-review

16 Citations (Scopus)

Abstract

This paper considers price determination by monopolistic sellers who know the distribution of valuations among the potential buyers. We derive a novel condition under which the optimal price set by the monopolist is unique. In many settings, this condition is easy to interpret, and it is valid for a very wide range of distributions of valuations. The results carry over to the optimal minimum price in independent private value auctions. In addition, they can be fruitfully applied in the analysis of quantity discount price policies.

Original language	English
Pages (from-to)	482-491
Number of pages	10
Journal	Journal of Econometrics
Volume	141
Issue number	2
DOIs	https://doi.org/10.1016/j.jeconom.2006.10.005
Publication status	Published - Dec 2007

Keywords

Auction
Hazard rate
Minimum price
Monopoly
Regularity

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title = "On the uniqueness of optimal prices set by monopolistic sellers",

abstract = "This paper considers price determination by monopolistic sellers who know the distribution of valuations among the potential buyers. We derive a novel condition under which the optimal price set by the monopolist is unique. In many settings, this condition is easy to interpret, and it is valid for a very wide range of distributions of valuations. The results carry over to the optimal minimum price in independent private value auctions. In addition, they can be fruitfully applied in the analysis of quantity discount price policies.",

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AB - This paper considers price determination by monopolistic sellers who know the distribution of valuations among the potential buyers. We derive a novel condition under which the optimal price set by the monopolist is unique. In many settings, this condition is easy to interpret, and it is valid for a very wide range of distributions of valuations. The results carry over to the optimal minimum price in independent private value auctions. In addition, they can be fruitfully applied in the analysis of quantity discount price policies.

KW - Auction

KW - Hazard rate

KW - Minimum price

KW - Monopoly

KW - Regularity

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EP - 491

JO - Journal of Econometrics

JF - Journal of Econometrics

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ER -

On the uniqueness of optimal prices set by monopolistic sellers

Abstract

Keywords

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