Every shroud has a silver lining: The visible benefits of hidden surcharges
de Meza, D.
& Reyniers, D. J.
(2012).
Every shroud has a silver lining: The visible benefits of hidden surcharges.
Economics Letters,
116(2), 151-153.
https://doi.org/10.1016/j.econlet.2012.02.027
& Reyniers, D. J.
(2012).
Every shroud has a silver lining: The visible benefits of hidden surcharges.
Economics Letters,
116(2), 151-153.
https://doi.org/10.1016/j.econlet.2012.02.027
Opportunities for shrouded pricing drive down upfront price as firms compete to capture new customers. Unless the surcharge is sufficiently high, consumers are worse off if the practice is banned, assuming Cournot-Nash equilibrium and isoelastic demand.