Price Discrimination Is Simply Modifying Essay

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and, as mentioned before, discrimination allows for a more flexible reallocation of capital, benefiting the customer by increasing research and development of other goods and services.

In the article "Taken to the Cleaners?" The author presents a real world case where dry cleaners are seemingly arbitrarily using price discrimination to mark up the price of dry cleaning for women's blouses vs. men's shirts. This is definitely a third-degree price discrimination, where different consumer's pay different prices. There are two separate markets, one composed entirely of men (or women who wear men's clothes), and the other composed entirely of women. Each is forced to pay different amounts for essentially the same service, thus this is price discrimination of the third degree. (Taken to the Cleaners?, 1998)

There are many real life examples of price discrimination.

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Take, for instance, the ubiquitous feature of most bars and nightclubs, "Ladies' Night," which offers discounts for females. According to Spiritus-Temporis.com, the purpose of a Ladies' Night is not to increase revenue, but to fix the inequitable gender balance present in most of these establishments. (Spiritus-Temporus) Men pay the standard price, while women pay a discounted offer. This is third degree price discrimination, for it charges two separate groups different prices for the same service.

Pricing discrimination, therefore, seems to be exactly what it is; pricing based on discriminatory practices or concepts. There are benefits to certain consumers and there are benefits to the firms themselves, but there are disadvantages as well. Each business must therefore discern its pricing policies accordingly.

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