Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/104249
Authors: 
Eichhorn, Christoph
Sahm, Marco
Year of Publication: 
2007
Series/Report no.: 
Munich Discussion Paper 2007-2
Abstract: 
We examine the pricing decision of a multi-product monopolist in a two-sided market where the type structure of buyers on one side of the market is an important determinant of profit on the other side. In this situation it might be optimal to set prices below the maximum sellout price and to ration demand by a random mechanism in the first market to reach a type distribution more favorable for sales in the other market. The model establishes demand quality as an alternative link between markets in addition to standard quantitative effects and explains frequently observed underpricing, e.g. in the (sports) entertainment industry. It also provides an explanation for the effort a monopolist incurs to deter from resale.
Subjects: 
Underpricing
Demand Rationing
Resale Deterrence
JEL: 
L12
D42
D45
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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