Bundling without Price Discrimination

Andrés Carvajal, Marzena Rostek and Marek Weretka
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Marzena Rostek: Department of Economics, University of Wisconsin-Madison,

The Warwick Economics Research Paper Series (TWERPS) from University of Warwick, Department of Economics

Abstract: This paper examines the optimal bundling strategies of a multiproduct monopoly in markets in which a seller cannot monitor and thereby restrict the purchases of buyers to a single bundle, while buyers have resale opportunities. In such markets, the standard mechanism through which bundling increases seller profits, based on price discrimination, is not feasible. The profit-maximizing bundling strategy is characterized, given the restrictions on pricing policies resulting from resale and a lack of monitoring. The welfare implications of optimal bundling are analyzed.

Keywords: Bundling; Pricing; Revenue Maximization; Product Design JEL Codes: D42; L12 (search for similar items in EconPapers)
Date: 2010
New Economics Papers: this item is included in nep-com, nep-ind and nep-mkt
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Citations: View citations in EconPapers (1)

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Working Paper: Bundling without Price Discrimination (2010)
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Persistent link: https://EconPapers.repec.org/RePEc:wrk:warwec:936

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