EconAir

  INFORMATION AND ECONOMIC THEORY A key strategy for corporate growth and development is innovation.    Innovation generates proprietary information, company-specific knowledge, and new technology.    A company’s products and services embody past innovation and the sum of proprietary information.    One of the assumptions of the perfect competition model is complete information.    All participants in a market know all relevant information.    As discussed in an earlier tutorial,  Introduction to Information and Economic Structure , this assumption is unrealistic in an imperfectly competitive economy dominated by large corporations. Proprietary information that cannot be duplicated by other companies allows a company to differentiate its products and services from those of other companies. Differentiated products and services reduce competition from other companies and limit the ability of a supplier or customer to play off one...

  One of the biggest shifts since 2013 is that a majority (52%, up from 39%) now say they are “willing to spend extra for a brand with an image that appeals to me.” Ipsos,  Global Trends, September 19, 2025. STARTING POINT Pareto's Law, the 80/20 rule, is the starting point for marketing and price discrimination. As discussed in a related post on basic concepts, Pareto's Law says, among other things, that a relatively small percent of customers account for a relatively large percent of sales and profits. One reason is the concentration of income and wealth. Recent studies indicate increasing concentration of income and wealth in the United States. A company's choice of target market and market niches is critical to marketing and pricing strategy.   CONTENTIONS Pricing is a strategy, not something a company accepts or beyond its control. Price discrimination is one pricing  strategy. Price discrimination can be practice by individual companies or all compa...