Bundling electronic journals and competition among publishers

Doh-Shin Jeon and Domenico Menicucci

Economics Working Papers from Department of Economics and Business, Universitat Pompeu Fabra

Abstract: Site licensing of e-journals has been revolutionizing the way academic information is distributed. However, many librarians are concerned about the possibility that publishers might abuse site licensing by practicing bundling. In this paper, we analyze the private and social incentives for the publishers to use bundling in the context of STM electronic journal market. In the short run in which the number of journals is exogenously given, we find a strong conflict between the two incentives: each publisher finds bundling optimal and bundling increases the industry profit but reduces social welfare. However, in the long run we find that publishers might have higher incentives to introduce new journals under bundling than without bundling and, in this case, bundling can reduce the industry profit while increasing social welfare. Finally, we examine publishers’ incentive to provide links to the websites of the rival publishers under bundling and show that even asymmetric publishers have incentive to interconnect.

Keywords: Bundling; site licensing; interconnection; merger (search for similar items in EconPapers)
JEL-codes: D4 K21 L41 L82 (search for similar items in EconPapers)
Date: 2003-04, Revised 2005-08
New Economics Papers: this item is included in nep-com, nep-hpe, nep-law and nep-mic
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Related works:
Working Paper: Bundling Electronic Journals and Competition among Publishers (2015)
Journal Article: Bundling Electronic Journals and Competition among Publishers (2006)
Working Paper: bundling electronic journals and competition among publishers (2004)
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Persistent link: https://EconPapers.repec.org/RePEc:upf:upfgen:678

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