Two-Part Marginal Pricing

  • Antonio Villar
Part of the Lecture Notes in Economics and Mathematical Systems book series (LNE, volume 438)


The marginal pricing rule has deserved special attention, because it satisfies the necessary conditions for optimality, and coincides with profit maximization when production sets are convex. Hence it describes competitive behaviour in the convex case, and defines a specific regulation policy when there are increasing returns to scale (even though its efficiency properties are far from satisfactory).


Budget Balance Marginal Price Production Equilibrium Linear Price Average Cost Price 
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Copyright information

© Springer-Verlag Berlin Heidelberg 1996

Authors and Affiliations

  • Antonio Villar
    • 1
  1. 1.Department of EconomicsUniversity of AlicanteAlicanteSpain

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