Exclusionary bundle discounts: A simple model with two applications

C.-Philipp Heller (), Heiner Lindenlaub () and Frank Maier-Rigaud
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C.-Philipp Heller: NERA Economic Consulting
Heiner Lindenlaub: NERA Economic Consulting

Economics Bulletin, 2020, vol. 40, issue 1, 210-216

Abstract: We develop a simple theoretical model of exclusionary bundle discounts. Based on the model, we develop a screening test for exclusionary bundle discounts. This test only requires knowledge of prices and an estimate of the coverage of the bundle discount. We apply this test to the Vodafone/Liberty Global merger in Germany and find bundle discounts in the German broadband Internet access market consistent with exclusion. We finally use the model to simulate the merger's price effects.

Keywords: exclusionary pricing; bundling; mergers (search for similar items in EconPapers)
JEL-codes: L1 L4 (search for similar items in EconPapers)
Date: 2020-02-05
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