Basing Point

Basing Point

In accounting, the geographical location where a commodity has a certain price. The basing point is used to help determine the price for the same commodity in another location. In general, the price at the basing point is added to transportation costs to arrive at the price elsewhere.
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1~ is increasing in direct proportion to the true transportation costs (t) relative to h = 0, the basing point, and not the actual production site (h = 1).
Benson, Greenhut, and Norman |1990~ also show that basing-point pricing can arise when production at the basing point is competitive while production at the periphery is monopolized.
Delivered Pricing and Multiple Basing Point Equilibria: A Reevaluation.
Imperfect competition and basing-point pricing

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