Compatibility and Bundling of Complementary Goods in a Duopoly
Carmen Matutes and
Pierre Regibeau ()
Journal of Industrial Economics, 1992, vol. 40, issue 1, 37-54
This paper presents a simple model of compatibility and bundling in industries where consumers assemble several necessary components into a system that is close to their ideal. The authors show that, for a wide range of parameters, firms will choose to produce compatible components but will offer discounts to consumers who purchase all components from the same firm. However, firms would be better off if they could commit not to provide such discounts. Furthermore, the equilibrium tends to involve socially excessive bundling. Finally, mixed bundling strategies tend to increase the range of parameters over which socially excessive standardization occurs. Copyright 1992 by Blackwell Publishing Ltd.
References: Add references at CitEc
Citations: View citations in EconPapers (131) Track citations by RSS feed
Downloads: (external link)
http://links.jstor.org/sici?sici=0022-1821%2819920 ... 0.CO%3B2-X&origin=bc full text (application/pdf)
Access to full text is restricted to JSTOR subscribers. See http://www.jstor.org for details.
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:bla:jindec:v:40:y:1992:i:1:p:37-54
Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=0022-1821
Access Statistics for this article
Journal of Industrial Economics is currently edited by Pierre Regibeau, Yeon-Koo Che, Kenneth Corts, Thomas Hubbard, Patrick Legros and Frank Verboven
More articles in Journal of Industrial Economics from Wiley Blackwell
Bibliographic data for series maintained by Wiley Content Delivery ().