STICERD Economic Theory Seminars
Pareto-improving Pricing: Why 3 is better than 2
Piotr Dworczak (Northwestern University), joint with Zi Yang Kang
Thursday 20 November 2025 15:30 - 17:00
Many of our seminars and public events this year will continue as in person or as hybrid (online and in person) events. Please check our website listings and Twitter feed @STICERD_LSE for updates.
Unless otherwise specified, in-person seminars are open to the public. Please ensure you have informed the event contact as early as possible.
Those unable to join the seminars in-person are welcome to participate via zoom if the event is hybrid.
About this event
We study the design of priority pricing systems with heterogeneous agents and costly waiting. Contrary to the equity–efficiency tradeoff emphasized in public debates, we show that it is possible to Pareto-improve on an unpriced status quo. Such an improvement requires at least three priority tiers, combining faster service for a fee, slower service with compensation, and an intermediate pooled tier; however, two priority tiers can never achieve this. Our results provide a framework for overcoming equity–efficiency tensions in applications such as internet traffic management, congestion pricing, and public service waitlists.
Economic Theory Seminars are held on Thursdays in term time at 15:30-17:00, both ONLINE and IN PERSON in SAL 3.05.
Seminar organisers: Dr Paula Ferreira Onuchic and Dr Christopher Sandmann.
For further information please contact Sadia Ali: s.ali43@lse.ac.uk.
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