Open Access. Powered by Scholars. Published by Universities.®

Law Commons

Open Access. Powered by Scholars. Published by Universities.®

Regulation

Law and Economics

MS Word

Melanie S. Williams

Articles 1 - 1 of 1

Full-Text Articles in Law

Tying And Bundled Discounts: An Equilibrium Analysis Of Antitrust Liability Tests, Melanie S. Williams Sep 2015

Tying And Bundled Discounts: An Equilibrium Analysis Of Antitrust Liability Tests, Melanie S. Williams

Melanie S. Williams

Courts have struggled with determining when bundled discounts constitute unlawfully anticompetitive behavior. The current circuit split reflects an absence of consensus. This lack of legal guidance creates uncertainty in the market, with firms being given inconsistent – and sometimes contradictory - standards on how to avoid antitrust liability.

For the most part, we consider a standard paradigm for analyzing bundled discounts. Suppose that there are two firms. Firm 1 produces a monopoly product, A, and also another product, B, which competes with another version of B produced by Firm 2. The concern is the extent to which the price paid …