help tdpd
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Title


    tdpd -- Third-degree price discriminating monopoly


Syntax

    tdpd a1 b1 a2 b2 c1 c2 c3, [invd]



Description

    tdpd computes the equilibrium of a third-degree discriminating monopolist
    facing two groups of consumers:  total output and its allocation between
    the two groups of consumers, prices charged to each group, profit of the
    monopolist, asf.  Results are provided with a precision of two decimals.

    tdpd also computes the equilibrium of the market if the monopoly does not
    price-discriminate.

    The 7 arguments a1 b1 a2 b2 c1 c2 c3 are compulsory.  They define the
    demands of the two groups of consumers, and the total cost function of
    the monopolist:

         Demand i:      Qi = ai - biPi, i = 1,2
         Total Cost:    TC = c1 + c2Q + c3Q^2

    Graphical representations are provided for the two equilibria
    (discriminating + non-discriminating).  Only two combined figures are
    displayed (MD and MND), but the six different graphs composing them can
    be displayed indivudally using graph display.  The names of the graphs
    are as follows:

         --------------------------------------------------------------------
         Discriminating monopoly
         group1d        Segment 1
         group2d        Segment 2
         marketd        Entire market
         DM             The three previous graphs horizontally aligned
         --------------------------------------------------------------------
         Non-discriminating monopoly
         group1nd       Segment 1
         group2nd       Segment 2
         marketnd       Entire market
         NDM            The three previous graphs horizontally aligned
         --------------------------------------------------------------------


Option

    invd is used when the parameters a1, b2, a2 and b2 define the inverse
    demands.  Algebraically:
    Inverse demand i:  Pi = ai - biQi, and thus Qi = ai/bi - 1/biPi, i = 1,2


Examples

    . tdpd 100 1 60 1 0 20 .25, invd
    . graph display marketd
    . graph display marketnd

    . tdpd 60 .2 60 .3 2000 40 0


Author

    Sylvain Weber
    University of Neuchâtel (Switzerland)
    Institute of Economic Research
    sylvain.weber@unine.ch


Reference

    The economic theory underlying tdpd is reviewed in:  Weber, Sylvain and
    Pasche, Cyril (2008) "Price Discrimination", Journal of Industrial