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Time preference and the welfare effects of tie-in sales


  • Heubrandner, Florian
  • Skiera, Bernd


This paper shows for B2C tie-in sales with a monopoly or competition in the durable market that tying increases welfare for the likely case that consumers exhibit higher discount rates than firms.

Suggested Citation

  • Heubrandner, Florian & Skiera, Bernd, 2010. "Time preference and the welfare effects of tie-in sales," Economics Letters, Elsevier, vol. 108(3), pages 314-317, September.
  • Handle: RePEc:eee:ecolet:v:108:y:2010:i:3:p:314-317

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    References listed on IDEAS

    1. Severin Borenstein & Jeffrey K. Mackie-Mason & Janet S. Netz, 2000. "Exercising Market Power in Proprietary Aftermarkets," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 9(3), pages 157-188, June.
    2. Mandy, David M, 1991. "Competitive Two-Part Tariffs as a Response to Differential Rates of Time Preference," Economica, London School of Economics and Political Science, vol. 58(231), pages 377-389, August.
    3. Whinston, Michael D, 1990. "Tying, Foreclosure, and Exclusion," American Economic Review, American Economic Association, vol. 80(4), pages 837-859, September.
    4. Ulrich Kamecke, 1998. "Tying Contracts and Asymmetric Information," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 154(3), pages 531-531, September.
    5. David L. Kaserman, 2007. "Efficient Durable Good Pricing And Aftermarket Tie-In Sales," Economic Inquiry, Western Economic Association International, vol. 45(3), pages 533-537, July.
    6. Shane Frederick & George Loewenstein & Ted O'Donoghue, 2002. "Time Discounting and Time Preference: A Critical Review," Journal of Economic Literature, American Economic Association, vol. 40(2), pages 351-401, June.
    7. Zhiqi Chen & Thomas Ross & W. Stanbury, 1998. "Refusals to Deal and Aftermarkets," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 13(1), pages 131-151, April.
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