Center for Contract and Economic Organization
Center for Law and Economic Studies
In his article, Marginal Cost Pricing, Investment Theory and CATV, James Ohls' makes a number of erroneous assertions concerning the optimum pricing of CATV. Most of his problems stem from a failure to properly define the environment in which the optimum price is to be set and the role that an optimum price should play. If one alters Ohls' implicit (and sometimes contradictory)2 assumptions and if one keeps in mind the purpose prices should serve in an economic system, a number of Ohls' conclusions are altered.
Victor P. Goldberg,
Marginal Cost Pricing, Investment Theory and CATV,
J. L. & Econ.
Available at: https://scholarship.law.columbia.edu/faculty_scholarship/2267