Publication Type
Master Thesis
Version
publishedVersion
Publication Date
2007
Abstract
With the development of the Internet, e-business has become popular. Increasingly, e-journals are being sold via the Internet. E- journals have two main characteristics: one is the low marginal cost associated with access; the other is the large number of items. For the commercially motivated seller, the issue of bundling a large number of low marginal cost items so as to maximize profits needs to be dealt with. In this thesis, a solution by way of an intermediate bundle is proposed. It is found that the profit obtained under the proposed procedure is 4% to 5% higher than that under the Chuang-Sirbu procedure, which is currently adopted by many sellers. Furthermore, when the number of products involved is not extremely large, the proposed procedure yields a profit level that is closer to the first price discrimination profit level than the Armstrong two-part tariff procedure. In this thesis, a heuristic rule to facilitate the determination of the optimal intermediate bundle size is also proposed. This is designed to avoid the lengthy simulation procedure that will be needed otherwise.
Keywords
aggregation, bundling, digital goods, information goods, pricing, publishing industry
Degree Awarded
MSc in Economics
Discipline
E-Commerce | Economics | Library and Information Science
Supervisor(s)
CHUA, Vincent
Publisher
Singapore Management University
City or Country
Singapore
Citation
TAN, Yong.
Bundling Information Goods: The Case of E-Journals. (2007).
Available at: https://ink.library.smu.edu.sg/etd_coll/8
Copyright Owner and License
Author
Creative Commons License
This work is licensed under a Creative Commons Attribution-NonCommercial-No Derivative Works 4.0 International License.