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Product bundling and shared information goods: A pricing exercise

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  • William G. Morrison

Abstract

In this article, the author describes an exercise in which two pricing problems (product bundling and the sharing of digital information goods) can be understood using the same analytical approach. The exercise allows students to calculate the correct numerical answers with relative ease, while the teaching plan demonstrates the importance of the distribution of reservation prices across consumers in determining the optimal pricing strategies.

Suggested Citation

  • William G. Morrison, 2016. "Product bundling and shared information goods: A pricing exercise," The Journal of Economic Education, Taylor & Francis Journals, vol. 47(1), pages 49-63, January.
    • Handle: RePEc:taf:jeduce:v:47:y:2016:i:1:p:49-63
    DOI: 10.1080/00220485.2015.1106360
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    References listed on IDEAS

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    1. Zentner, Alejandro, 2006. "Measuring the Effect of File Sharing on Music Purchases," Journal of Law and Economics, University of Chicago Press, vol. 49(1), pages 63-90, April.
    2. Bakos, Yannis & Brynjolfsson, Erik & Lichtman, Douglas, 1999. "Shared Information Goods," Journal of Law and Economics, University of Chicago Press, vol. 42(1), pages 117-155, April.
    3. John C. Eckalbar, 2006. "Exploring Bundling Theory with Geometry," The Journal of Economic Education, Taylor & Francis Journals, vol. 37(1), pages 68-82, January.
    4. Felix Oberholzer-Gee & Koleman Strumpf, 2007. "The Effect of File Sharing on Record Sales: An Empirical Analysis," Journal of Political Economy, University of Chicago Press, vol. 115(1), pages 1-42.
    5. Liebowitz, Stan J, 2006. "File Sharing: Creative Destruction or Just Plain Destruction?," Journal of Law and Economics, University of Chicago Press, vol. 49(1), pages 1-28, April.
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