Does behaviour-based price discrimination foster firms differentiation?

We study the impact of behaviour-based price discrimination on the incentive of the firms to differentiate their products. We consider both ‘standard’ and ‘extreme’ behaviour-based price dis- crimination: the latter always reduces the incentive to differentiate with respect to uniform pricing, while the former fosters differentiation if the consumers are sufficiently forward-looking and/or the firms are sufficiently myopic.