Examples of price discrimination; Easy jet


3rd degree price discrimination is when a firm charges different prices by splitting the market into two and charging the two sets of consumers two different prices.

With the growing trend of people buy tickets on the internet, it is become ever easier for airline firms such as easy jet to change their prices frequently. People who are willing to commit themselves to a flight months in advance book early and get a relatively cheap price. The airlines such as easy jet, will raise the price of each ticket as the date of departure approaches. Because there is only a few flights to certain destinations in a week, some one who wants to visit these countries, will have to go with easy jet. With only one flight, consumers would pay more for a seat on this flight than usual.

This price discrimination in the 3rd degree is clearly unfair, because even though the same service was being used, the plane journey, the price between what some passengers paid for the seat is significantly different. In 2004, the European commission made a law saying that airline such as easy jet cannot raise the price of airlines tickets above 300% of what it started of at (as reported by the times). This is small victory, but a victory none the less in the war on unreasonable plane fares.