De Nijs, Romain; Rhodes, Andrew - In: Economics Letters 118 (2013) 1, pp. 155-158
We consider a two-period model in which duopolists sell experience goods and practice behavior-based price discrimination (BBPD). We give general conditions for when firms should offer a lower price to existing customers (‘pay-to-stay’) or to new customers (‘pay-to-switch’). We also...