Price Discrimination in Oligopoly: Evidence from Swedish Newspapers

Asplund , Marcus; Eriksson, Rikard; Strand, Niklas

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Price Discrimination in Oligopoly: Evidence from Swedish Newspapers

23 Pages Posted: 16 Apr 2002

See all articles by Marcus Asplund

Marcus Asplund

London Business School - Department of Economics; University of Gothenburg - School of Business, Economics and Law; Centre for Economic Policy Research (CEPR)

Rikard Eriksson

Stockholm School of Economics - Stockholm Institute of Transition Economics (SITE)

Niklas Strand

Stockholm School of Economics - Stockholm Institute of Transition Economics (SITE)

Date Written: March 2002

Abstract

This Paper provides an empirical examination of third-degree price discrimination in the Swedish newspaper industry. The results show that price discrimination is more prevalent in competitive markets and among newspapers with low market shares. This supports predictions from recent theoretical work, including Chen (1997) and Fudenberg and Tirole (2000), that suggest that firms attempt to poach consumers from rivals by offering targeted discounts. In addition, we find weak evidence that newspapers in markets with large inflows of new consumers and those covering wide geographical areas offer more discounts.

Keywords: Price discrimination, oligopoly, newspapers

JEL Classification: D43, L13, L82

Suggested Citation: Suggested Citation

Asplund, Marcus and Eriksson, Rikard and Strand, Niklas, Price Discrimination in Oligopoly: Evidence from Swedish Newspapers (March 2002). Available at SSRN: https://ssrn.com/abstract=307603