Interactive Glossary

BROWSE:

Subsidy-free pricing:

Prices such that no consumer (or group of consumers) could obtain service at a lower price from an alternative supplier (or technology). On the other hand, if some consumers pay more than the cost of the next best alternative, then (if the supplier is earning normal economic profits) other consumers are paying less than the total incremental cost of serving them (ie. they are receiving an implicit subsidy).

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