Dominance and Competitive Bundling

Competitive Bundling

This paper proposes a model of competitive bundling with an arbitrary number of …rms. In the regime of pure bundling, we …nd that relative to separate sales pure bundling tends to raise market prices, bene…t …rms, and harm consumers when the number of …rms is above a threshold. This is in contrast to the …ndings in the duopoly case on which the existing literature often focuses. Our analysis al...

Competitive Nonlinear Pricing and Bundling∗

We examine the impact of multiproduct nonlinear pricing on profit, consumer surplus and welfare in a duopoly. When consumers buy all their products from one firm (the one-stop shopping model), nonlinear pricing leads to higher profit and welfare, but usually lower consumer surplus, than linear pricing. By contrast, in a unit-demand model where consumers may buy one product from one firm and ano...

Price Bundling in Competitive Markets:

Competitive Bundling and Counter-bundling with Generalist and Specialist Firms - Technical Appendix

Competitive Bundling and Counter-bundling with Generalist and Specialist Firms: Research Note1

Bundling, which is the practice of selling two or more products or services in a package, is a pervasive marketing practice and is often used as a strategic competitive tool. However, there has not been enough consideration of competitive bundling situations where exit of a competitor is not a concern. In this paper, we address this issue by identifying conditions under which strategic competit...