Department   Undergraduate School  , School of Commerce
   Position   Professor
Language Japanese
Publication Date 2017/01
Type Academic Journal
Peer Review Peer reviewed
Title Endogenous Product Boundary, Manchester School
Contribution Type Co-authored (other than first author)
Journal Manchester School
Journal TypeAnother Country
Volume, Issue, Page 81(1),pp.13-40
Author and coauthor Takanori Adachi, Takeshi Ebina, and Makoto Hanazono
Details This study analyzes the determinants of product boundary choice as discriminatory pricing. Specifically, we consider a model where a monopolist sells a base product with an add-on valuable only if it is consumed along with the base product. An important feature of this model is that this additional value is contingent on the valuation of the base product. We show that separation, in which case only the base product is sold, yields a higher profit than integration, where only a bundled package is sold, if and only if the range of the add-on value exceeds a threshold value and that separation is more likely to become optimal as the degree of positive contingency increases. As for welfare, consumer surplus in case of separation is always lower than that when the seller is constrained to sell the bundled package.
URL for researchmap https://researchmap.jp/ebinatakeshi2010/