Date

2014

Department or Program

Economics

Additional Department or Program (if any)

Economics

Title of Approved Individual Major

Economics

Primary Wellesley Thesis Advisor

Casey G. Rothschild

Abstract

This paper studies the optimal product design for a linear pricing monopolist. I ask what the profit maximizing strategy for a monopolist is, while making sure that it is correctly targeting at different types of consumers. Whenever perfect separation of the two types is informationally infeasible, the optimal menu of a linear pricing monopolist involves products that distort qualities for both types of consumers away from the first best allocations.

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