Affiliation:
1. School of Management, Yale University (email: )
Abstract
This paper studies the optimal bundling of products with nonadditive values. Under monotonic preferences and single-peaked profits, I show that a monopolist finds pure bundling optimal if and only if the optimal sales volume for the grand bundle is larger than the optimal sales volume for any smaller bundle. I then detail how my analysis relates to ratio monotonicity results on bundling and describe the implications for nonlinear pricing. (JEL D21, D42, L12, L25)
Publisher
American Economic Association
Subject
Management, Monitoring, Policy and Law,Geography, Planning and Development
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