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The Marginal Price Effects of Antitrust Rules Against Price Discrimination

Hans Zenger, Charles River Associates

Abstract

The two central pricing rules contained in most antitrust laws are prohibitions of below-cost pricing and prohibitions of discriminatory pricing. This article shows that the rule against discriminatory pricing may actually induce firms to charge exclusionary below-cost prices, even in the complete absence of any predatory intent on the part of firms.

Suggested Citation

Hans Zenger. "The Marginal Price Effects of Antitrust Rules Against Price Discrimination" Economics Letters 117.3 (2012): 921-923.