As it becomes easier for firms to collect and use consumer data, concerns are growing over the possible wider application of personalized pricing. This study first analyzes the welfare effects of personalized pricing, and then proposes policy directions that can help in addressing the potential issues.

In a monopoly market, personalized pricing maximizes social welfare but drastically diminishes consumer surplus compared to uniform pricing. However, this can be mitigated with a deterioration in the precision of personalized pricing or if consumers can and are willing to anonymize their identities. When firms compete, the welfare effects of personalized pricing varies with the nature of competition. It is possible that consumer surplus increases with personalized pricing when there is best-response asymmetry. It is also found that under personalized pricing, entry is less likely while predatory pricing is more likely.

Given that the welfare effects of personalized pricing depend heavily on the competitive aspects of a market and that the data protection law is not only for dealing with personalized pricing, a competition law should be primarily applied to determine whether certain personalized pricing acts are abusive. In particular, personalized pricing in a market with limited competition or that which is intended to lessen competition needs to be more closely monitored. This study also presents suggestions on designing and enforcing both the competition and data protection laws in a complementary manner so that they can effectively deal with personalized pricing.

Preface
Executive Summary

Chapter 1 Introduction

Chapter 2 Overview of Personalized Pricing Strategies
　Section 1 Price Discrimination Theory
　Section 2 Concept of Personalized Pricing Strategies
　Section 3 General Process for Implementing Personalized Pricing
　Section 4 Factors Influencing the Use of Personalized Pricing
　Section 5 Current State of Personalized Pricing Adoption

Chapter 3 Welfare Effects of Personalized Pricing Strategies
　Section 1 Monopolistic Situation
　Section 2 Competitive Situation
　Section 3 Anti-Competitive Effects of Personalized Pricing

Chapter 4 Conclusion and Policy Recommendation
　Section 1 Summary of Key Findings
　Section 2 Policy Considerations for Addressing Personalized Pricing
　Section 3 Limitations of the Study

References
Appendix
ABSTRACT