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Title: Bundling and Menus of Two-Part Tariffs Author(s): Sreya Kolay and Greg Shaffer Volume: 51 Issue: 3 Pages: 383-403 Abstract: Inducing self-selection among different segments of consumers is an important issue in pricing. Some firms induce self-selection by offering a menu of two-part tariffs (e.g. different rate plans) and letting consumers select the tariff and quantity they prefer. Other firms induce self-selection by offering a menu of price-quantity bundles (e.g. different package sizes) and letting consumers select only from amongst these bundles. We show that bundling is more profitable absent cost considerations. Social welfare may be higher or lower with bundling. [Previous Article] [Next Article] [This Issue] [Next Issue]
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Last modified 26/08/2010 © Copyright 2006 The Journal of Industrial Economics, Ltd. |