1.
When given a free hand to segment their customers, businesses will generally set a higher price for people who can afford to pay more. This might be less equal but it is more equitable. For example, let's say Paramount Studios releases the latest James Bond film - they will want to charge an Australian cinema more for the right to screen the film than an Indian cinema. My sense of social justice says it is fair for someone whose income is £4/day to be charged less to see a film than someone who earns £100/day. If Paramount was forced to charge the same price then it would mean that Indian cinemas simply cannot afford to buy the rights to screen the film, and Indians would miss out entirely.
The argument is even stronger for medicine. If a pharmaceutical company can be sure there is no arbitrage between two countries, then it will want to sell a medical treatment cheaper in India than in Australia. That is A Good Thing.
2.
If you say to a business, "You must offer your product to Person A and Person B for the same price" then you are restricting the total size of the economic pie in a similar way to saying "You must offer your product for $6". Take Paramount Studios again - if they are prevented from charging different prices in different countries then they will earn less revenue. This means they will be pay their scriptwriters less, have less impressive special effects and pay less tax. (Or quite possibly the film is not made at all).
3.
You are happy for a car insurance company to discriminate on the basis of sex if there is a real difference in accident rates between men and women. Would you allow a car insurance company to discriminate on the basis of race if there is a real difference in accident rates?
But:
1. When given a free hand to segment their customers, businesses will generally set a higher price for people who can afford to pay more. This might be less equal but it is more equitable. For example, let's say Paramount Studios releases the latest James Bond film - they will want to charge an Australian cinema more for the right to screen the film than an Indian cinema. My sense of social justice says it is fair for someone whose income is £4/day to be charged less to see a film than someone who earns £100/day. If Paramount was forced to charge the same price then it would mean that Indian cinemas simply cannot afford to buy the rights to screen the film, and Indians would miss out entirely.
The argument is even stronger for medicine. If a pharmaceutical company can be sure there is no arbitrage between two countries, then it will want to sell a medical treatment cheaper in India than in Australia. That is A Good Thing.
2. If you say to a business, "You must offer your product to Person A and Person B for the same price" then you are restricting the total size of the economic pie in a similar way to saying "You must offer your product for $6". Take Paramount Studios again - if they are prevented from charging different prices in different countries then they will earn less revenue. This means they will be pay their scriptwriters less, have less impressive special effects and pay less tax. (Or quite possibly the film is not made at all).
3. You are happy for a car insurance company to discriminate on the basis of sex if there is a real difference in accident rates between men and women. Would you allow a car insurance company to discriminate on the basis of race if there is a real difference in accident rates?