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The Howard Shuttering Contractors case throws considerable light on the importance which the tribunals attach to warnings before dismissing an employee. In this case the tribunal…
Abstract
The Howard Shuttering Contractors case throws considerable light on the importance which the tribunals attach to warnings before dismissing an employee. In this case the tribunal took great pains to interpret the intention of the parties to the different site agreements, and it came to the conclusion that the agreed procedure was not followed. One other matter, which must be particularly noted by employers, is that where a final warning is required, this final warning must be “a warning”, and not the actual dismissal. So that where, for example, three warnings are to be given, the third must be a “warning”. It is after the employee has misconducted himself thereafter that the employer may dismiss.
An examination of imperfect price discrimination, modelled as a linear combination of perfect price discrimination and uniform pricing, is used to analyze the impact of imperfect…
Abstract
An examination of imperfect price discrimination, modelled as a linear combination of perfect price discrimination and uniform pricing, is used to analyze the impact of imperfect discrimination on firm size and product diversity. Additionally, claims that perfect price discrimination leads to the welfare optimum are shown to be generally false.
Kaushik Mitra and Louis M. Capella
Presents various aspects of price discrimination in the context of services marketing. Provides a mathematical model which takes demand‐related variables, competitive factors and…
Abstract
Presents various aspects of price discrimination in the context of services marketing. Provides a mathematical model which takes demand‐related variables, competitive factors and basic costs into consideration. Factors affecting price discrimination are studied under service intrinsic factors and extrinsic/environmental factors. Also presents mathematical models to demonstrate the viability of price discrimination under different capacity utilization and demand constraint scenarios. Finally, provides the managerial implications of the models along with directions for future research.
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The purpose of this paper is to whether competition between platforms can be effective, thus leading to efficient allocations.
Abstract
Purpose
The purpose of this paper is to whether competition between platforms can be effective, thus leading to efficient allocations.
Design/methodology/approach
Based on the classic linear Hoteling model, this paper builds a two-period competition model for two competing platforms using two variants, namely, a discrimination pricing model and a unified pricing model.
Findings
In the case of the discrimination pricing model, the competition is moderate, and the two platforms split the market evenly in the first stage, while both platforms tended to offer preferential treatment to new users and set higher prices for regular customers in the second stage. Compared to the unified pricing model, in the first stage, the platform can provide a higher price that depends on the cross-network effect when it implements discrimination, and thus, obtains higher profits. However, in the second stage, fierce competition leads to the release of benefits, new and regular customers obtain lower prices and the platforms lose higher profits. In the long-run, discriminatory pricing is not the best option due to lower total profits. The two platforms will implement cooperative pricing or one platform becomes dominant.
Originality/value
Instead of focusing on the cross-network effects, this paper emphasizes the role of the same-side network effect on price discrimination regarding the platforms’ competition. The same-side network effects are investigated in relation to a discrimination pricing strategy and compared to a unified pricing strategy. Another innovative aspect is the study of these network effects in a dynamic setting based on a two-period competition model for two platforms.
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The purpose of this paper is to show that information goods allow new forms of second degree price discrimination because of their economic special features. In addition, it shall…
Abstract
Purpose
The purpose of this paper is to show that information goods allow new forms of second degree price discrimination because of their economic special features. In addition, it shall be explained why it makes economical sense for information providers to make offers free of charge, and how price discrimination can assist them thereby.
Design/methodology/approach
This paper is a literature‐based and practical/analytical depiction, showing in which context the three price discrimination forms have developed and how they are effectively applied.
Findings
Windowing, versioning, and bundling are very effective strategies of price discrimination for information goods. This can be illustrated through various application examples. With the division of information content and media carriers a clear distinction between windowing, versioning, and bundling is achieved.
Practical implications
Information providers receive support for the design of their pricing policy. It is obvious, that with the aid of the depicted price discrimination variants, both market penetration with cost free offers and the generation of revenues from product sales can be aimed for.
Originality/value
What is new about the paper is the first time comparative portrayal of three recent second degree price discrimination forms and their application to information goods.
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A study of the price discounts granted by Morton Salt Company and other producers of table salt in the U.S. on their sales of table salt to grocery wholesalers and retailers. The…
Abstract
A study of the price discounts granted by Morton Salt Company and other producers of table salt in the U.S. on their sales of table salt to grocery wholesalers and retailers. The discounts were found to be illegal under the Robinson-Patman Act by the Federal Trade Commission and the Supreme Court. The Commission and the Court believed that the discounts were unjustified price concessions granted to “large” buyers, consistent with the concerns of the Robinson-Patman Act. However, the evidence indicates that the most common discount – the “carload discount” – was received by virtually all buyers, regardless of the buyer’s size; the other discounts – “annual volume” discounts – though received primarily by “large” buyers, were likely cost based. The history of the discounts and likely reasons why they were granted are explored in detail.
This is the first paper in a volume devoted exclusively to antitrust law and economics. It summarizes the other papers and addresses two issues. First, after showing that the…
Abstract
This is the first paper in a volume devoted exclusively to antitrust law and economics. It summarizes the other papers and addresses two issues. First, after showing that the federal courts generally view consumer welfare as the ultimate goal of antitrust law, it asks what they mean by that term. It concludes that recent decisions appear more likely to equate consumer welfare with the well-being of consumers in the relevant market than with economic efficiency. Second, it asks whether a buyer must possess monopsony power to induce a price discrimination that is not cost justified. It concludes that a buyer can often obtain an unjustified concession simply by wielding bargaining power, but the resulting concession may frequently – though not always – improve consumer welfare.
Two‐part pricing and block pricing are two extensively used techniques for price discrimination which seem to have received little attention in the marketing literature. Also, it…
Abstract
Two‐part pricing and block pricing are two extensively used techniques for price discrimination which seem to have received little attention in the marketing literature. Also, it does not seem to be generally appreciated that quantity discounts can be employed as a vehicle for price discrimination. This paper describes these techniques and discusses from a managerial perspective why they can be profitable and how they might be implemented. A comparison of the advantages and disadvantages of these techniques versus conventional methods of price discrimination based on a priori segmentation of the market is also presented.
Price becomes a main instrument for rationing pharmaceutical drugs in Central America as a consequence of pro‐market reforms implemented in the 1980s. Under market‐rationing…
Abstract
Purpose
Price becomes a main instrument for rationing pharmaceutical drugs in Central America as a consequence of pro‐market reforms implemented in the 1980s. Under market‐rationing conditions, people's access to branded drugs does depend on their purchasing power and on the vector of prices they face. The purpose of this paper is to study the regional pricing strategy followed by pharmaceutical firms across Central American countries. These countries differ in such economic factors as per capita income, income distribution, market size, and nature and extent of their social‐security system; thus, there are conditions that foster the implementation of price‐discrimination practices across the region.
Design/methodology/approach
The investigation takes advantage of a large database with information about prices of identical drugs sold across Central American countries and produced by 17 large pharmaceutical companies. Regression analyses are used to study whether price discrimination exists in Central American drug markets and what pricing strategies are followed by different pharmaceutical companies.
Findings
Results show that there are significant differences in the prices of identical drugs across the Central American countries, as well as that pharmaceutical companies follow different pricing strategies.
Originality/value
Cross‐country price comparisons are usually based on constructed price indices, which imply losing detailed information about the products being compared. This investigation uses prices of identical drugs, rather than constructed price indices, to study cross‐country price differences by pharmaceutical companies across the Central American region. The study of price discrimination is crucial to understanding how markets end up rationing such an essential product as pharmaceutical drugs.
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Norton E. Marks and Neely S. Inlow
This study was undertaken to determine what trends have been occurring in price discrimination in the United States over the past 25 years. The vehicle here will he U.S. District…
Abstract
This study was undertaken to determine what trends have been occurring in price discrimination in the United States over the past 25 years. The vehicle here will he U.S. District Court actions filed and decisions rendered under the Robinson‐Patman Act from 1961 through 1986. Marketing practitioners and educators have long been discussing the relative impact of the Robinson‐Patman Act on pricing practices. In the years following passage of the Act in 1936, these marketing professionals have felt that noncompliance would bring down the wrath of the federal government. And, for the most part, this fear was well founded. If, in fact, Robinson‐Patman is alive and well today, are large firms practicing discriminatory pricing? If so, are they discriminating and not being prosecuted? Or are they discriminating in price, being prosecuted, and not being convicted of the charge?