Yongmin Chen () and
Journal of Public Economics, 2018, vol. 159, issue C, 116-127
When procuring multiple products from competing sellers, a buyer may choose separate purchase, pure bundling, or mixed bundling. We show that pure bundling maximizes buyer surplus when there are two sellers and trade for each good is likely efficient, whereas separate purchase can be optimal for the buyer when there are more sellers or one good has a low probability of trade. We explain how these results are related to the reduction of sellers' cost dispersion and the potential “adverse tying” under bundling. Remarkably, mixed bundling is dominated under procurement, in contrast to the finding under monopoly bundled sales.
Keywords: Procurement; Bundled procurement; Separate purchase; Bundling; Mixed bundling (search for similar items in EconPapers)
JEL-codes: D21 H57 L24 (search for similar items in EconPapers)
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed
Downloads: (external link)
Full text for ScienceDirect subscribers only
Working Paper: Bundled procurement (2015)
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:eee:pubeco:v:159:y:2018:i:c:p:116-127
Access Statistics for this article
Journal of Public Economics is currently edited by R. Boadway and J. Poterba
More articles in Journal of Public Economics from Elsevier
Bibliographic data for series maintained by Haili He ().