Firms launch products at high prices and later reduce them to engage in price discrimination
the verdict
SUPPORTED
the evidence backs this
confidence 75/100
Economic literature supports the practice of launching products at high prices and reducing them over time as a mechanism for intertemporal price discrimination.
Evidence for · 2
Intertemporal Price-Quality Discrimination and the Coase Conjecture
2003 · cited by 0
This study analyzes time-consistent intertemporal price discrimination by a monopolist, showing that prices decline over time to screen buyers with heterogeneous preferences.
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More for · 1
Pricing strategy in the context of durable goods monopoly with discrete demand
2015 · cited by 0
This article demonstrates that a durable goods monopolist uses intertemporal pricing strategies to effectively price discriminate among consumers with varying willingness to pay.