scholarly journals Optimal Tradable Credits Scheme and Congestion Pricing with the Efficiency Analysis to Congestion

2015 ◽  
Vol 2015 ◽  
pp. 1-6 ◽  
Author(s):  
Ge Gao ◽  
Jun Hu
Keyword(s):  
Social Welfare ◽  
Choice Behavior ◽  
Congestion Pricing ◽  
Consumer Surplus ◽  
Efficiency Analysis ◽  
Numerical Examples ◽  
Demand Distribution ◽  
The Social ◽  
Tradable Credits ◽  
Performance Results

We allow for three traffic scenarios: the tradable credits scheme, congestion pricing, and no traffic measure. The utility functions of different modes (car, bus, and bicycle) are developed by considering the income’s impact on travelers’ behaviors. Their purpose is to analyze the demand distribution of different modes. A social optimization model is built aiming at maximizing the social welfare. The optimal tradable credits scheme (distribution of credits, credits charging, and the credit price), congestion pricing fees, bus frequency, and bus fare are obtained by solving the model. Mode choice behavior under the tradable credits scheme is also studied. Numerical examples are presented to demonstrate the model’s availability and explore the effects of the three schemes on traffic system’s performance. Results show congestion pricing would earn more social welfare than the other traffic measures. However, tradable credits scheme will give travelers more consumer surplus than congestion pricing. Travelers’ consumer surplus with congestion pricing is the minimum, which injures the travelers’ benefits. Tradable credits scheme is considered the best scenario by comparing the three scenarios’ efficiency.

STORE PROMOTION, MANUFACTURER COMPETITION AND WELFARE

2021 ◽  
pp. 1-18
Author(s):  
HAO WANG ◽  
XUNDONG YIN ◽  
ALICE Y. OUYANG
Keyword(s):  
Social Welfare ◽  
Consumer Preferences ◽  
Consumer Surplus ◽  
Weighted Average ◽  
Brand Name ◽  
Price Distortion ◽  
Online Platforms ◽  
Brand Competition ◽  
The Social ◽  
Partial Exclusion

This study evaluates the partial exclusion effects of store promotion. We find that a manufacturer with a better brand name has a higher willingness-to-pay for promotion services offered by retail stores or online platforms. The promotion results in higher sales-weighted average prices (wholesale and retail) and a larger inter-brand price gap. The stores or platforms extract more profits from manufacturers and consumers through the promotion services. The effects on consumer surplus and social welfare depend on whether the promotion alters consumer preferences. If it does, more consumers would be choosing their less-preferred brands because of the larger inter-brand price gap, which would be socially inefficient. If it does not, the promotion may help to correct the price distortion, but the social welfare effect is positive only when the promotion effect is small enough. In both cases, the promotion services reduce the total consumer surplus by softening inter-brand competition.

Information Transparency Hypothesis

2011 ◽  
pp. 15-42 ◽  
Author(s):  
Kevin Zhu
Keyword(s):  
Social Welfare ◽  
Consumer Surplus ◽  
Electronic Markets ◽  
Theoretic Model ◽  
Electronic Market ◽  
Information Transparency ◽  
The Social ◽  
B2b Exchanges ◽  
Game Theoretic ◽  
Business To Business

This chapter explores the private and social desirability of information transparency of a business-to-business (B2B) electronic market that provides an online platform for information transmission. The abundance of transaction data available on the Internet tends to make information more transparent in B2B electronic markets. In such a transparent environment, it becomes easier for firms to obtain information that may allow them to infer their rivals’ costs than in a traditional, opaque market. How then does this benefit firms participating in the B2B exchanges? To what extent does information transparency affect consumers and the social welfare in a broader sense? Focusing on the informational effects, this study explores firms’ incentives to join a B2B exchange by developing a game-theoretic model under asymmetric information. We then examine its effect on expected profits, consumer surplus, and social welfare. Our results challenge the “information transparency hypothesis” (that is, open sharing of information in electronic markets is beneficial to all participating firms). In contrast to the popular belief, we show that information transparency could be a double-edged sword. Although its overall effect on social welfare is positive, its private desirability is deeply divided between producers and consumers, and even among producers themselves.

Multiproduct Duopoly with Vertical Differentiation

2011 ◽  
Vol 11 (1) ◽  
Author(s):  
Yi-Ling Cheng ◽  
Shin-Kun Peng ◽  
Takatoshi Tabuchi
Keyword(s):  
Quality Improvement ◽  
Social Welfare ◽  
Arbitrary Number ◽  
Consumer Surplus ◽  
Vertical Differentiation ◽  
Two Stage ◽  
Unit Costs ◽  
The Social ◽  
Market Coverage ◽  
Heterogeneous Consumers

This paper investigates a two-stage competition in a vertically differentiated industry, where each firm produces an arbitrary number of similar qualities and sells them to heterogeneous consumers. The number of products, qualities, prices, and the extent of the market coverage are endogenously determined. We show that when unit costs of quality improvement are increasing and quadratic, each firm has an incentive to provide a disconnected set of similar qualities approximating a continuum. The finding contrasts sharply with the single-quality outcome when the market coverage is exogenously determined. We also show that allowing for multiple qualities intensifies the level of competition, lowers the profit of each firm, and raises the consumer surplus and the social welfare in comparison to the single-quality duopoly.

POSTPONED HOLDBACK PRICING, PROFIT AND CONSUMER SURPLUS

2012 ◽  
Vol 29 (01) ◽  
pp. 1240007 ◽  
Author(s):  
YIGAL GERCHAK
Keyword(s):  
Supply Chain ◽  
Social Welfare ◽  
Demand Uncertainty ◽  
Production Capacity ◽  
Consumer Surplus ◽  
Revenue Sharing ◽  
Operational Decisions ◽  
Demand Functions ◽  
Decentralized Supply Chain ◽  
The Social

Operational decisions of a monopolist firm affect expected social welfare, a fact typically ignored by OM models. Specifically, the price selected directly affects the consumer surplus, which has to be added to firm's profit to find the social welfare. We assume an uncertain, price-sensitive, demand. Production capacity is selected at the outset, but the price is chosen after demand uncertainty realized itself. This model was proposed by Van Mieghem and Dada (1999), but we extend it to other demand functions. We then compute the resulting consumer surplus. Finally, we consider such issues in a decentralized supply chain with revenue sharing.

scholarly journals Two extensions of consumer surplus

SERIEs ◽  
2021 ◽  
Author(s):  
Luis C. Corchón ◽  
Ramón J. Torregrosa
Keyword(s):  
Lower Bound ◽  
Social Welfare ◽  
Social Welfare Function ◽  
Consumer Surplus ◽  
Utility Functions ◽  
Cournot Equilibrium ◽  
Income Effects ◽  
Welfare Losses ◽  
The Social ◽  
Quasilinear Utility

AbstractWe study consumer surplus in a single market when (a) there is a lower bound in the consumption of the outside good and (b) the weights in the social welfare function given to consumers and firms are different. We assume quasilinear utility. When the lower bound constraint on the consumption of the outside good is binding, income effects arise in demand. In some cases, Cournot equilibrium output is below equilibrium output without this constraint because the constraint makes demand less elastic. When the weights given to consumers and firms are not identical, social welfare is not necessarily concave and profits might be negative at the unrestricted optimum. We characterize social welfare optimum with a bound on maximum losses in a class of utility functions. We offer a formula to find the percentage of welfare losses due to oligopoly in this case.

scholarly journals Incomplete Regulation, Asymmetric Information, and Collusion-Proofness

2012 ◽  
Vol 2012 ◽  
pp. 1-17
Author(s):  
Marco Meireles ◽  
Paula Sarmento
Keyword(s):  
Asymmetric Information ◽  
Social Welfare ◽  
Social Welfare Function ◽  
Consumer Surplus ◽  
Relative Importance ◽  
Side Payments ◽  
The Social ◽  
Regulated Firm

In an incomplete regulation framework, the regulator cannot replicate all the possible outcomes by himself since he has no influence over some firms in the market. Due to asymmetric information, it may be better for the regulator to allow the unregulated firms to extract a truthful report from the regulated firm through side-payments under collusion, and therefore the “collusion-proofness principle” may not hold. In fact, by introducing an exogenous number of unregulated firms, social welfare differences seem to favour a collusion-allowing equilibrium. However, such result will depend on the relative importance given by the regulator to the consumer surplus in the social welfare function.

An Analytical Exposition of the Social Welfare Role of Wealth in Islam

2015 ◽  
Author(s):  
Ahmad Bello Dogarawa ◽  
Suleiman Muhammad Hussain
Keyword(s):  
Social Welfare ◽  
The Social
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