A Comparison of Bundling and Sequential Pricing in Competitive Markets: Experimental Evidence

Technological advances enable sellers to identify relationships among offered goods. Sellers can leverage this information through pricing strategies such as bundling and sequential pricing. While these strategies have primarily been studied under monopoly assumptions, the strategies are available to competitive firms as well. This paper reports on a series of laboratory experiments comparing bundling and sequential pricing while varying the underlying relationship between the goods in markets where a fraction of buyers comparison shop. The results indicate that sequential pricing is generally as profitable to the seller; however, there is evidence that sequential pricing may be more harmful to consumers than bundling when the goods have complementary values or the buyer’s values are positively correlated.     

Patterns of multi-agent land conservation: Crowding in/out,agglomeration, and policy

Private agents make large contributions to networks of conserved land, but little is known about how private agents’ decisions might be altered by government actions. This paper explores the impact of public conservation and public policy on the quantity and configuration of private land conservation and the extent to which the social optimum is reached. Because land conservation benefits often have thresholds and spatial characteristics, we consider the impact of different land conservation benefit functions on the patterns of conservation created by the interaction of private and public agents. We find that public conservation crowds private conservation in or out depending on whether marginal conservation benefits increase or decrease with total acreage, and crowding out is mitigated by the presence of budget constraints. We show how land conservation agents might interact strategically in space depending on preferences over fragmentation, and we explore that spatial strategic interaction in a case with a regional land trust and a case with hot-spot parcels. We identify when government policies, such as agglomeration bonuses and mitigating coordination costs, are most likely to increase the social benefits provided by private land conservation agents.