10.4 Price discrimination
10.4.1 Definition and conditions
a. Definition
Price discrimination has been defined in a number of different ways. The simplest definition relates to the situation where a firm ells the same product at different prices to different customers. However, the most useful definition involves a firm selling the same or similar products at different prices in different markets, where such price differentials are not based on differences in marginal cost. This latter definition covers a broader range of situations and leads to a greater understanding regarding the nature of price discrimination. Using this definition we can consider the following common practices as price discrimination: