What Is First Degree Price Discrimination
September 9, 2026
First-degree price discrimination is when a seller charges each buyer exactly what they're willing to pay, so the seller captures all the surplus and the buyer keeps none. In theory, it can raise the seller's profit by the full amount of consumer surplus, but one study found that real-world data could reach only about 42% of the theoretical maximum. Bruegel's discussion of big-data pricing That sounds abstract until you...