Behavior-based price discrimination and customer information sharing

Romain de Nijs (1, 2, 3)

1 X - École polytechnique
2 PSE - Paris-Jourdan Sciences Economiques
3 PSE - Paris School of Economics

This article investigates the incentives and the effects of information sharing among rival firms about the identities of their past customers in a two-period model with behaviorbased price discrimination (BBPD). An unilateral information exchange between the two periods takes place in a subgame-perfect equilibrium. This exchange increases the ability of the industry to price discriminate consumers according to their profiles and boosts the profitability of BBPD at the expense of consumers.

Mots clés: Price discrimination; Dynamic pricing; Privacy; Information sharing

Domaines: Economies et finances

Romain de Nijs. Behavior-based price discrimination and customer information sharing. 2015. ⟨hal-01226250⟩