Ramsey Pricing

A Method for Setting Fees in Social Service Organizations

Bibliographic Data

ID2825437
AuthorsDouglas J Mc Cready (Wilfrid Laurier University, corresponding author)
Year1988
Volume47
Issue1
Pages97-110
Publication date1988-01-01
Peer ReviewedYes
Open AccessYes
TypeARTICLE
VenueAmerican Journal of Economics and Sociology (JOURNAL)
Journal identifiersISSN: 0002-9246 • E-ISSN: 1536-7150
PublisherWiley (PUBLISHER • GB)
DOI10.1111/j.1536-7150.1988.tb02013.x
OpenAlexW2139559954
LanguageEN
Citations received1
References cited8

In non-profit social services, there is a tendency to avoid setting prices because of the distributional concerns and incompetence on the part of some consumers. Arguments for prices and cash transfers versus in-kind subsidies are reviewed. The appropriateness is examined of "Ramsey pricing" in achieving efficient resource allocation in a zero-profit firm when marginal cost pricing would lead to a profit. A survey of social service agencies in Ontario, Canada, found none was using the principles of "Ramsey pricing" and most were using no fees or prices at all. Some agencies had set prices but then waived them while others set fees equivalent to services provided by nonsocial service agencies. Most view fees as supplemental additions to the budget and consequently do not consider resource allocation. "Ramsey pricing," it is believed, could be beneficially tried by social service agencies

Actuarial science · Business · Cash · Economics · Incentive · Marginal cost · Market economy · Microeconomics · Pricing strategies · Profit (economics) · Service (business) · Subsidy · Economic and Environmental Valuation · Finance · Gender, Labor, and Family Dynamics · Healthcare Policy and Management · Marketing

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