Publication Type
Working Paper
Version
publishedVersion
Publication Date
3-2005
Abstract
This paper examines the optimality of intertemporal price discrimination when network externality effects are present in the consumption of a durable good. We conduct our study in two settings. In a model with two household types, utilities are dependent on the cumulative proportion of households that have purchased the durable good. Next, in a model with a continuum of household types, we extend the analysis to the case where households consume both a durable good and a stream of non-durable goods. We show that in both settings, the presence of network externalities facilitates a sales strategy with intertemporal price discrimination.
Keywords
intertemporal price discrimination, durable good, household demand, network externality
Discipline
Behavioral Economics
Research Areas
Applied Microeconomics
Volume
05-2005
First Page
1
Last Page
22
Publisher
SMU Economics and Statistics Working Paper Series, No. 05-2005
City or Country
Singapore
Citation
KOH, Winston T. H..
Household Demand, Network Externality Effects and Intertemporal Price Discrimination. (2005). 05-2005, 1-22.
Available at: https://ink.library.smu.edu.sg/soe_research/824
Copyright Owner and License
Authors
Creative Commons License
This work is licensed under a Creative Commons Attribution-NonCommercial-No Derivative Works 4.0 International License.
Comments
Published in Journal of Economics, 2005, 84 (1), 49-69. https://doi.org/10.1007/s00712-004-0100-z