Screening by Mode of Trade

Beccuti, Juan; Möller, Marc (2019). Screening by Mode of Trade (Discussion Papers 19-08). Bern: Department of Economics

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This paper proposes a mechanism design approach, capable of endogenizing a monopolist’s choice between selling and renting in a non-anonymous durable goods setting with short-term commitment. Allowing for mechanisms that determine the good’s allocation not only at the beginning but also at the end of a given period, we show that the profit-maximizing mechanism features screening by mode of trade. By selling to high types while renting to low types, the monopolist overcomes the obstacles encountered by intertemporal price discrimination and induces immediate separation of types for arbitrary low priors.

Item Type:

Working Paper

Division/Institute:

03 Faculty of Business, Economics and Social Sciences > Department of Economics
03 Faculty of Business, Economics and Social Sciences > Department of Economics > Institute of Economics > Economic Theory

UniBE Contributor:

Beccuti Vazquez, Juan Ignacio and Möller, Marc

Subjects:

300 Social sciences, sociology & anthropology > 330 Economics

Series:

Discussion Papers

Publisher:

Department of Economics

Language:

English

Submitter:

Dino Collalti

Date Deposited:

02 Apr 2020 11:26

Last Modified:

02 Apr 2020 11:26

JEL Classification:

D82, D86, D42

BORIS DOI:

10.7892/boris.138523

URI:

https://boris.unibe.ch/id/eprint/138523

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