Working Papers, Department of Economics, Lund University
Nonlinear Pricing and the Utility Possibility Set
Abstract: We consider nonlinear pricing policies that are designed
by a social welfare maximizer who operates under a non-negative profit
requirement. In our two-type economy, we characterize the set of all
feasible nonlinear pricing policies and the frontier of the utility
possibility set. Our results provide a link between distortion in
consumption and individual, as well as, social welfare.
Keywords: Nonlinear Pricing; Budget-Balance; Welfare; (follow links to similar papers)
JEL-Codes: D42; D82; (follow links to similar papers)
8 pages, March 4, 2005
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