So, I think we are talking past each other. Price discrimination vs a single price market does not involve a reduction of waste. The quantity transacted is identical to what would have been transacted under the market-clearing single price. 1/

I think you have in mind less formal scenarios, like involving price discrimination in allocating goods you’d otherwise have thrown away. 2/

It can be an interesting question whether price discrimination hurts consumers less than a producer with market power withholding output to support higher prices. 3/

But relative to the base case of a competitive single-price market, both of those choices create welfare losses for consumers in aggregate in order to benefit producers, at least within the narrow context of the allocation. 4/

(Producers will argue consumers net benefit over time because their businesses would not be sustainable absent some appropriation of consumer surplus relative to the competitive outcome, and withdrawal if their goods from the market would leave consumers worse off.) 5/

(But that’s a way of saying some important industries cannot survive under full competition, which is accurate and true. It’s not clear letting businesses unilaterally exercise market power is the best or fairest way to address that, though.) /fin