Price Discrimination In Oligopoly Market

Along with our country telecommunications completing the fourth restructuring and promoting3G project construction gradually, China’s mobile communication market has formed three oligopoly competition pattern, with China mobile, China Unicom and China Telecom as the main part, and three big operators also entered the era of whole business competition. Facing the intense market competition and complex operation environment, operators take all kinds of competition strategies to improve their competitive advantage. Among these strategies, the most obvious is the differentiation competitive strategy of which connotation is products and services. Operators continuously introduce pricing packages which collect price, service and brand. Although giddy tariff packages meet the diversified market demand to a certain extent, helping operators take the best opportunity in the market competition and win the competitive advantage, consumers are overwhelmed with these packages, and their choice cost and switching cost are increased. Therefore, we can not help but ask:how do operators introduce a variety of packages when they are not familiar with the different preferences of consumers? What kind of competitive strategies are these differential packages? What kind of results can these strategies produce in such oligopoly market like Chinese mobile telecommunication market? And whether is it effective? This paper hopes to solve these problems with related study.Firstly this thesis analyzes the evolution of Chinese telecommunication market competition pattern, the characteristics of present market competition structure and the competition strategies operators take; Then analyzes pricing packages operators continuously introduce in recent years from the view of revealed preference, clarifies the essence of these packages is price discrimination, and discusses the application of price discrimination theory in mobile telecommunication industry of our country. Finally, based on price discrimination model of monopoly market and the extended Cournot model and Stankolhberg’s model, this paper does study into the second and third degree price discrimination of symmetrical and asymmetric oligopoly market. by applying complete information static game theory and complete information dynamic game theory. Working out the corresponding equilibrium results and giving concrete mathematical expressions, at last arriving at a few general conclusions by comparative analysis equilibrium results of different models. This thesis hopes to provide some revelation for the future telecom industry reform and the application of oligopoly enterprises’competition strategies.As an important pricing strategy, price discrimination strategy has always been the study focus for domestic and foreign scholars. At present, although the study of price discrimination in monopoly market has been quite mature, related study in oligopoly market especially in asymmetric oligopoly is still insufficient, this article also hopes to enrich the study content through related study and help expand the study field of price discrimination theory.