Pure component pricing in a duopoly

Chun Hsiung Liao, Amparo Urbano

Research output: Contribution to journalArticlepeer-review

4 Citations (Scopus)

Abstract

In this paper, we focus on price competition between several multi-product firms which produce differentiated systems, each consisting of two complementary products. It is shown here that if firms are restricted to pure component pricing (bundling is not allowed) whenever components produced are compatible, pure strategy equilibrium may not exist. With the use of bundling strategies, pure strategy equilibrium always exists. For the pure component pricing case we provide a full characterization for the existence of a pure strategy equilibrium.

Original languageEnglish
Pages (from-to)150-163
Number of pages14
JournalManchester School
Volume70
Issue number1
DOIs
Publication statusPublished - 2002 Jan

All Science Journal Classification (ASJC) codes

  • Economics and Econometrics

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