Business Commons^™

Consumer Welfare And Price Discrimination: A Fine Line, Marie Wallmark, Eyal Greenberg, Dan Engels

SMU Data Science Review

Traditionally, it was not feasible for businesses to determine the maximum price the buyer was willing to pay, but with the availability of big data and the deployment of sophisticated algorithms, with a great degree of precision businesses can ascertain the maximum willingness price. Some forms of price discrimination are prohibited under the Robinson-Patman Act of Antitrust (1890), provided demographic characteristics such as race and gender are the determining factors. The problem with this interpretation is that sellers are not transparent about what factors are taken into consideration when determining price. Current laws are either limited in their interpretation or …