from Part I - Monopoly
Published online by Cambridge University Press: 24 November 2022
A bundled discount exists when a firm offers a lower price on a bundle of goods or services relative to the individual prices of the goods or services. Suppose that a multiproduct firm offers its customers a 5 percent discount on its list prices if the customer buys all of its requirements of latex gloves and surgical masks from the firm. If the customer buys any of the products from a second source, the discount falls to, say, 3 percent. The discounts are said to be “bundled” because the discount earned on gloves depends on the purchases of gloves and masks rather than just the purchases of gloves. In some instances, this apparently procompetitive discount schedule can foreclose an equally efficient producer of, say, surgical masks. In this event, the bundled discount schedule raises antitrust concerns. However, formulating an economically sensible antitrust policy is not easy. In this chapter, we review relevant antitrust cases including PeaceHealth and discuss remedies for bundled discounts.
To save this book to your Kindle, first ensure [email protected] is added to your Approved Personal Document E-mail List under your Personal Document Settings on the Manage Your Content and Devices page of your Amazon account. Then enter the ‘name’ part of your Kindle email address below. Find out more about saving to your Kindle.
Note you can select to save to either the @free.kindle.com or @kindle.com variations. ‘@free.kindle.com’ emails are free but can only be saved to your device when it is connected to wi-fi. ‘@kindle.com’ emails can be delivered even when you are not connected to wi-fi, but note that service fees apply.
Find out more about the Kindle Personal Document Service.
To save content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about saving content to Dropbox.
To save content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about saving content to Google Drive.