Multiproduct Pricing

Multi masterfessional personduct Pricing in Oligopoly? Sandro Shelegia† part of economics University of Vienna April 18, 2011 filch This paper proposes a two-good poseur of toll competition where well-nigh(prenominal) consumers prate all the shops and new(prenominal)s visit save virtuoso. We ?nd that the randomness frictions carry on to price dispersion. When the two goods atomic number 18 complements their prices exit be negatively tally so if one of them is priced mellowed, then the other one is at a discount. This ?nding is supported by some empirical pronounce which suggests that simultaneous price discounts of complements ar infrequent. If the goods are substitutes, then their prices will be uncorrelated, potentially rationalizing the escape of evidence on their co-price. When sell complements, retailers earn higher pro?ts than in the one-good model by discriminating consumers through burdensome captives with high overall price tag and attracting shoppers by pricing one of the goods aggressively. Due to this, pack practices are shown to be pestiferous to retailers pro?ts. JEL classi?cation: D83, L11, L13. Keywords: Multiproduct Competition, Complements, Substitutes.

I am grateful to Antonio Cabrales and Andreu Mas-Colell for careful supervision, Karl Schlag for very(prenominal) helpful discussions, Sjaak Hurkens, Maarten Janssen, Xavier Vivies, and to participants of the Simposio de Analisis Economico, Zaragoza 2008, European overwinter Meeting of Econometric Society, Cambridge 2008, over-embellished Economic Society fourth PhD Presentation Meeting, London 2009, workshop in Industrial Organization, Lecce 2009, EARIE one-year Meeting, Ljubljana 2009, and invited seminars at the University of Vienna, University of Toronto, DIW Berlin, University of Maastricht, Norwegian school day of political economy and Business, pantywaist Mary University London, for their comments. Any stay errors are my own. † electronic mail:sandro.shelegia@univie.ac.at; Tel.: +43 1 4277 37466; telecommunicate: +43 1 4277 37498; telephone extension work: BWZ 232, Br¨nner Straße 72, 1210 Vienna, Austria. u ? 1...If you want to get a blanket(a) essay, order it on our website: Ordercustompaper.com

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