31E11100 - Microeconomics: Pricing, Lecture, 5.9.2022-19.10.2022
This course space end date is set to 19.10.2022 Search Courses: 31E11100
Reading assignment 3 (due 21.9. at 10:15)
Completion requirements
Due: Wednesday, 21 September 2022, 10:15 AM
Read Yannis Bakos and Erik Brunjolfsson (1999): “Bundling Information Goods: Pricing, Profits, and Efficiency”, Management Science 45 (2). (available at https://pubsonline.informs.org/doi/abs/10.1287/mnsc.45.12.1613 via Aalto VPN)
1. Explain intuitively in your own words the main result of the paper, i.e. that bundling a large number of information goods together can be very profitable to the seller. Why would this result not hold for more traditional goods that have a positive marginal cost of production?
2. Can you think of real applications for the theory presented in the paper?