Document Type
Discussion Paper
Publication Date
1-27-2021
CFDP Number
2273
CFDP Update Date
February 26, 2021
CFDP Pages
28
Abstract
This paper studies optimal bundling of products with inter-dependent values. I show that, under some conditions, a firm optimally chooses to sell only the full bundle of a given set of products if and only if the optimal sales volume of the full bundle is larger than the optimal sales volume for any smaller bundle. I then provide an interpretation of this characterization based on (i) the magnitude of the variation across consumers in how complementary they find different products, and (ii) how this variation correlates with price sensitivity.
Recommended Citation
Ghili, Soheil, "A Characterization for Optimal Bundling of Products with Inter-dependent Values" (2021). Cowles Foundation Discussion Papers. 2598.
https://elischolar.library.yale.edu/cowles-discussion-paper-series/2598