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Exclusionary Bundle Discounts: A Simple Model with Two Applications
04 February 2020
Heiner Lindenlaub and Dr. C.-Philipp Heller
In the article “Exclusionary Bundle Discounts: A Simple Model with Two Applications,” published in Volume 40, Issue 1, of Economics Bulletin, Senior Consultant Heiner Lindenlaub, Consultant Dr. C.-Philipp Heller, and former Managing Director Prof. Dr. Frank Maier-Rigaud develop a simple theoretical model to test for exclusionary bundle discounts.
The authors apply their test to the Vodafone/Liberty Global merger in Germany and find bundle discounts in the German broadband Internet access market consistent with exclusion. They also use the model to simulate the merger’s price effects.