Exclusionary Bundling and the Effects of a Competitive Fringe
AbstractThe traditional analysis of exclusionary bundling examines the impact of a monopolist bundling product A with another product B, which is competitively provided. Using experimental posted-offer markets, we investigate the exclusionary and welfare implications of having a fringe competitor in the A market. We find that the fringe seller increases the consumer surplus while decreasing the seller surplus and that the fringe seller does not affect the consumer surplus extracted from the bundle despite a decrease in the bundle transaction price. The consumer surplus gains generated by the fringe seller erode if the dominant seller has a lower average cost.
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Bibliographic InfoArticle provided by Mohr Siebeck, Tübingen in its journal Journal of Institutional and Theoretical Economics.
Volume (Year): 163 (2007)
Issue (Month): 1 (March)
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- C99 - Mathematical and Quantitative Methods - - Design of Experiments - - - Other
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- L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
- L41 - Industrial Organization - - Antitrust Issues and Policies - - - Monopolization; Horizontal Anticompetitive Practices
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- Jeroen Hinloopen & Wieland Mueller & Hans-Theo Normann, 2011.
"Output Commitment through Product Bundling: Experimental Evidence,"
Tinbergen Institute Discussion Papers
11-170/1, Tinbergen Institute, revised 14 Jul 2013.
- Hinloopen, Jeroen & Müller, Wieland & Normann, Hans-Theo, 2014. "Output commitment through product bundling: Experimental evidence," European Economic Review, Elsevier, vol. 65(C), pages 164-180.
- Hinloopen, Jeroen & Müller, Wieland & Normann, Hans-Theo, 2013. "Output commitment through product bundling: Experimental evidence," DICE Discussion Papers 116, Heinrich‐Heine‐Universität Düsseldorf, Düsseldorf Institute for Competition Economics (DICE).
- Jeroen Hinloopen & Wieland Müller & Hans-Theo Normann, 2011. "Output Commitment through Product Bundling: Experimental Evidence," Vienna Economics Papers 1112, University of Vienna, Department of Economics.
- Smith, Angela M., 2011. "An experimental study of exclusive contracts," International Journal of Industrial Organization, Elsevier, vol. 29(1), pages 4-13, January.
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