“The Economic Way of Thinking”
12th Edition
Chapter 8: Price Searching（觅价）
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Chapter Outline
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Price Takers and Price Searchers
The Popular Theory of Price Setting
Introducing Ed Sike
The Basic Rule for Maximizing Net Revenue
The Concept of Marginal Revenue
Why Marginal Revenue is Less Than Price
Setting Marginal Revenue to Equal Marginal
Cost
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Chapter Outline
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
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What About Those Empty Seats?
The Price Discriminator’s Dilemma
Some Strategies for Price Discrimination
Ed Sike Finds a Way
Resentment and Rationale
Cost-Plus-Markup Reconsidered
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Introduction

只要企业供应额外一个单位产品的边际收益预
期超过其边际成本，它就会供应这个额外单位。

边际成本和边际收益相等是市场竞争过程的结
果，而不是在这个过程之前经济主体行为的假
设。

这就是净收益最大化过程的逻辑。
Net Revenue = TR – TC

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Price Takers（受价者） and Price
Searchers（觅价者）
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Questions

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Does US Steel establish the price for its product?
Does a farmer establish the price for his/her
product?
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Price Takers and Price Searchers
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Question

What would happen if a farmer tried to sell his
product above the current market price of $3.38 ¾?
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Price Takers and Price Searchers
P
3.50
Won’t sell any
Sell all he wants
3.48
D
Sell all he wants
3.46
Q
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Price Takers and Price Searchers

The farmer is a price taker.
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He cannot affect the price
He can sell all he wants at the market price
He will probably not sell any at a price above the
market price
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Price Takers and Price Searchers
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Normal Seller
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Sells more at a lower price
Sells less at a higher price
These firms are price searchers
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They search for the price that is most
advantageous to them
They have some market power
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Price Takers and Price Searchers
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Market power
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A matter of degree
Inversely related to elasticity of demand
More substitutes – more elastic the demand
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Price Takers and Price Searchers
P
Demand curves
faced by price
searchers
Q
11
The Popular Theory of Price Setting

A Popular Belief
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Selling price is cost plus markup（成本加成）.
Questions
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Why choose 25 versus a 50 percent markup?
Why will a firm vary its percentage markup
depending upon various factors?
Why sell below average cost?
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The Popular Theory of Price Setting
Cost-Plus-Markup Theory
is obviously inadequate.
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Introducing Ed Sike
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Example.
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
Ed Sike is a college sophomore（二年级学生）
He sells film tickets to earn spending money
He sets the price for his tickets
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Introducing Ed Sike
Ed’s Costs Per Movie
Film rental
$1,800
Auditorium rental（礼堂租金） 250
Operator（放映员）
50
Ticket takers（售票员）
100
Total
$2,200
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Introducing Ed Sike

Scenario
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Ed receives all revenue
Auditorium seats 700 people
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Introducing Ed Sike
7
D
Price Per Ticket
6
5
4
3
2
1
0 100 200 300 400 500 600 700 800 900
Number of Tickets
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Introducing Ed Sike

Scenario

Ed is expected to earn as much net revenue as
possible
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The Basic Rule for
Maximizing Net Revenue

Set the price to sell only those units whose
marginal revenue is expected to be greater
than marginal costs.
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The Concept of Marginal Revenue
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
Marginal revenue is the addition of total
revenue from selling one more unit.
Marginal cost is the addition to total cost from
selling an additional unit.

Ed’s marginal cost is zero
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The Concept of Marginal Revenue
Ed’s Demand Schedule
Price
$7
6
5
4
$3
Quantity
Demanded
300
400
500
600
700
Total
Revenue
$2,100
2,400
2,500
2,400
$2,100
Net
Revenue
-$100
200
300
200
-100
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The Concept of Marginal Revenue
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如何确定净收益最大化的价格？

方法一：把每个可能的价格都试验一遍；
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The Concept of Marginal Revenue

方法二：确定边际收益等于边际成本时的电影
票数量，然后（根据需求曲线）找出可以把这
么多电影票卖完的价格。


在上述例子中，边际收益=边际成本=0，对应的数
量为500张，价格为$5.
Question：Why is profit maximized where
marginal revenue equals marginal cost?
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Why Marginal Revenue
is Less Than Price

Marginal Revenue < Price

Why?

In order to increase sales, Ed must lower the price on
the additional ticket and the ones that would have
been sold at a higher price.
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Why Marginal Revenue
is Less Than Price

Marginal Revenue

The difference between the revenue gained from
additional quantity and the revenue lost from
lowering price on the previous quantity.
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Why Marginal Revenue
is Less Than Price
P
A
Lost
B
Gained
Q
26
Why Marginal Revenue
is Less Than Price
P
Additions to
net revenue
MC
Subtractions
from net
revenue
MR
Q
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Why Marginal Revenue
is Less Than Price

Questions
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What would Ed have to do to sell 550 tickets
instead of 500?
How would this impact his marginal revenue?
Is it a correct pricing decision?
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Why Marginal Revenue
is Less Than Price
P
D
MR
0 100 200 300 400 500 600 700 800 900
Q
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Setting Marginal Revenue
to Equal Marginal Cost

Question

What would happen if the distributor changed the
rental fee from a flat $1,800 to $800.00 + $2/ticket
sold?
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Setting Marginal Revenue
to Equal Marginal Cost
P
What is Ed’s
net revenue now?
7
6
5
4
3
2
1
Marginal cost
D
MR
0 100 200 300 400 500 600 700 800 900
Q
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What About Those Empty Seats?
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Questions
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Are seats going to waste?
Why doesn’t Ed lower the price on the empty
seats?
类似情况很普遍
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The Price Discriminator’s Dilemma（价
格歧视者的困境）

Question

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When should Ed leave seats empty?
Answer

If the cost of discriminating among potential ticket
buyers is greater than the additional revenue
gained through discrimination.
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The Price Discriminator’s Dilemma

Question

What if Ed offered to sell the empty seats for $3 to
anyone willing to pay more?
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Some Strategies for Price Discrimination
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Grocery coupons（食品折扣）
Discounts for:
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Children
Students
Senior Citizens
Airfare Prices for:
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Business traveler
Vacationer
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Some Strategies for Price Discrimination
P
P
Business
Traveler
Vacation
Traveler
D
D
Q
Q
36
Ed Sike Finds a Way
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Questions
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Could Ed increase revenue by charging different
groups of customers different prices?
Should students or teachers pay the higher price?
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Ed Sike Finds a Way
7
Ds
Dfaculty
Price Per Ticket
6
5
4
3
MRfaculty
2
1
MRs
0 100 200 300 400 500 600 700 800 900
Number of Tickets
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Resentment and Rationale（不满及其合
理化）
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Firms must justify price discrimination
Conditions necessary for price discrimination:
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Distinguish buyers from different price elasticities
Prevent low-price buyers from reselling to highprice buyers
Control resentment
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Resentment and Rationale
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那些批评一切价格歧视的人应该用更客观的角
度来看待这个问题:
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成功的价格歧视当然能增加卖方的财富；但同时也
增加了买方的财富或福利（如果没有歧视定价，有
些商品就无法提供出来）
歧视定价可以看作是买卖双方之间的一种协作方式！
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Cost-Plus-Markup Reconsidered
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Price searchers:
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Estimate marginal cost and marginal revenue
Determine the appropriate level of output
Set their prices so that they can just manage to
sell the output produced.
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Cost-Plus-Markup Reconsidered
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觅价者任务的复杂性和不确定性使得成本加成
理论被当作一种经验法则。
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Price Takers’ Markets and
“Optimal” Resource Allocation
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经济学中有种传统：
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把所有觅价者称为垄断者
把买方和卖方都是受价者的市场称为竞争市场
（competitive market）
他们使用“垄断-竞争”这一区分想要强调觅
价和受价两种情形下的不同结果，但是受价情
形下同样存在竞争。

“垄断”的传统提法具有误导性！
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Price Takers’ Markets and
“Optimal” Resource Allocation

经济学家在“竞争市场”（受价者市场）上看
到了一个重要优点：

资源的“最优配置”（“optimal” allocation of
resources）！
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Price Takers’ Markets and
“Optimal” Resource Allocation

Let’s look at the demand and supply curves
for house painters during a summer.

This will be used to illustrate the advantages of
the price takers assumption.
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Price Takers’ Markets and
“Optimal” Resource Allocation

Remember:
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Supply curves are marginal opportunity cost
curves.
Marginal opportunity cost curves for any individual
will slope upward to the right.
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Price per Hour
Price Takers’ Markets and
“Optimal” Resource Allocation
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22
20
18
16
14
12
10
8
6
4
2
0 0
S= MC
Sometimes
called the
“optimal
D
allocation of
resources”
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2
3
4
5
6
7
8
9
10
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Thousands of Hours
of House Painting
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Price per Hour
Price Takers’ Markets and
“Optimal” Resource Allocation
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22
20
18
16
14
12
10
8
6
4
2
0 0
S= MC
Gain from
trade
foregone
D
1
2
3
4
5
6
7
8
9
10
11
Thousands of Hours
of House Painting
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Price Takers’ Markets and
“Optimal” Resource Allocation
Prices fixed above marginal cost rule out
some mutually advantageous exchange
opportunities.
49
Price Takers’ Markets and
“Optimal” Resource Allocation

在传统的经济分析中，受价者市场比觅价者市
场具有某种优越性：


In a price takers’ market: No seller can set and
keep price above marginal cost
In a price searchers’ market:They can do so.
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Once Over Lightly
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

Elasticity of demand reflects the number of
substitutes.
The more substitutes a product has the more
elastic the demand for a product.
Competition makes some sellers price takers
while others with less competition are price
searchers.
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Once Over Lightly
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

Price searchers are looking for pricing
structures that will enable them to sell all
units for which MR>MC.
A crucial factor for a price searcher is the
ability or inability to discriminate.
The crucial rule for price searching is to set
MR = MC.
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