The Impact of Service Bundling on Consumer Switching Behaviour: Evidence from UK Communication Markets

Tim Burnett

The Centre for Market and Public Organisation from The Centre for Market and Public Organisation, University of Bristol, UK

Abstract: This paper empirically analyses the impact of the bundling of four common home communication services with a single supplier on the probability that an individual changes supplier using a survey-elicited dataset of 2,871 individuals. Implementing a random effects probit approach to control for individual heterogeneity, the results strongly show that when individuals bundle their service then they are significantly less likely to change supplier. A second result indicates that service- and supplier- related variables are better predictors of an individual's likelihood of switching than are the characteristics of the individual, suggesting that future research in this area should prioritise their inclusion.

Keywords: Bundling; Consumers; Panel-data; Regulation; Switching; telecommunications (search for similar items in EconPapers)
JEL-codes: C3 C5 D1 L5 L8 (search for similar items in EconPapers)
Pages: 52 pages
Date: 2014-05
New Economics Papers: this item is included in nep-com, nep-mkt and nep-reg
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (15)

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Persistent link: https://EconPapers.repec.org/RePEc:bri:cmpowp:14/321

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