Economic Theories of Bundling and Their Policy Implications in Abuse Cases: An Assessment in Light of the Microsoft Case

37 Pages Posted: 8 Feb 2005

See all articles by Kai-Uwe Kuhn

Kai-Uwe Kuhn

University of East Anglia (UEA) - Centre for Competition Policy; Centre for Economic Policy Research (CEPR)

Robert Stillman

Lexecon Ltd.

Cristina Caffarra

Lexecon Ltd.

Multiple version iconThere are 2 versions of this paper

Date Written: November 2004

Abstract

Theories of bundling have had great importance in European competition policy in recent merger control and abuse of dominance cases. Prominent examples include GE/Honeywell, Tetra Laval/Sidel and the recent Microsoft decision. The European Commission has been heavily criticized in all of those cases. In this Paper, we attempt to sketch how a systematic approach to bundling cases can be structured. We first provide an overview of existing bundling theories, concentrating on robust economic mechanisms and their empirical implications. This allows us to develop a number of clear criteria to identify potentially anticompetitive bundling. We show that a careful reading undermines recently proposed arguments for a (modified) per se legality rule for bundling.

Keywords: Bundling, efficiency defenses, foreclosure, policy rules

JEL Classification: K21, L41

Suggested Citation

Kuhn, Kai-Uwe and Stillman, Robert and Caffarra, Cristina, Economic Theories of Bundling and Their Policy Implications in Abuse Cases: An Assessment in Light of the Microsoft Case (November 2004). Available at SSRN: https://ssrn.com/abstract=663404

Kai-Uwe Kuhn (Contact Author)

University of East Anglia (UEA) - Centre for Competition Policy ( email )

UEA
Norwich Research Park
Norwich, Norfolk NR47TJ
United Kingdom

Centre for Economic Policy Research (CEPR)

London
United Kingdom

Robert Stillman

Lexecon Ltd. ( email )

Orion House
5 Upper St Martin's Lane
London WC2H 9EA
United Kingdom

Cristina Caffarra

Lexecon Ltd. ( email )

Orion House
5 Upper St Martin's Lane
London WC2H 9EA
United Kingdom

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
52
Abstract Views
1,893
rank
29,184
PlumX Metrics