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Cornière, Alexandre de
and Taylor, Greg
(2017)
Upstream bundling and leverage of market power.
TSE Working Paper, n. 17-827, Toulouse
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Abstract
We present a novel rationale for bundling in vertical relations. In many markets, upstream firms compete to be in the best downstream slots (e.g., the best shelf in a retail store or the default application on a platform). Bundling by a multiproduct upstream firm can soften competition for slots by reducing rivals' value for them. This strategy does not rely on entry deterrence and can be achieved through contractual or even virtual tying. We also study the effects of upstream bundling on the downstream market; by intensifying competition there, bundling can leave consumers better-off even when there is foreclosure upstream.
| Item Type: | Monograph (Working Paper) |
|---|---|
| Language: | English |
| Date: | July 2017 |
| Place of Publication: | Toulouse |
| JEL Classification: | L1 - Market Structure, Firm Strategy, and Market Performance L4 - Antitrust Issues and Policies |
| Subjects: | B- ECONOMIE ET FINANCE |
| Divisions: | TSE-R (Toulouse) |
| Institution: | Université Toulouse 1 Capitole |
| Site: | UT1 |
| Date Deposited: | 16 Apr 2018 15:12 |
| Last Modified: | 18 Jan 2022 10:20 |
| OAI Identifier: | oai:tse-fr.eu:31806 |
| URI: | https://publications.ut-capitole.fr/id/eprint/25632 |
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