Does Bundling Decrease the Probability of Switching Telecommunications Service Providers?

Does Bundling Decrease the Probability of Switching Telecommunications Service Providers? I examine whether bundling of telecommunications services makes individuals less likely to switch their service provider because of increased switching costs. Using a detailed survey dataset from the Korea Information Society Development Institute (KISDI), I find that Internet subscribers who previously bundled are less likely to switch their Internet service provider than are those who did not bundle. The results are robust to correction for the potential selection problem through the use of an endogenous treatment model. The finding that bundling reduces the probability of switching service providers and locks-in existing users can have important implications for market competitiveness and consumer welfare. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Review of Industrial Organization Springer Journals

Does Bundling Decrease the Probability of Switching Telecommunications Service Providers?

Loading next page...
 
/lp/springer_journal/does-bundling-decrease-the-probability-of-switching-telecommunications-TLMli4tG8P
Publisher
Springer Journals
Copyright
Copyright © 2016 by Springer Science+Business Media New York
Subject
Economics; Industrial Organization; Microeconomics
ISSN
0889-938X
eISSN
1573-7160
D.O.I.
10.1007/s11151-016-9532-1
Publisher site
See Article on Publisher Site

Abstract

I examine whether bundling of telecommunications services makes individuals less likely to switch their service provider because of increased switching costs. Using a detailed survey dataset from the Korea Information Society Development Institute (KISDI), I find that Internet subscribers who previously bundled are less likely to switch their Internet service provider than are those who did not bundle. The results are robust to correction for the potential selection problem through the use of an endogenous treatment model. The finding that bundling reduces the probability of switching service providers and locks-in existing users can have important implications for market competitiveness and consumer welfare.

Journal

Review of Industrial OrganizationSpringer Journals

Published: Jul 22, 2016

References

You’re reading a free preview. Subscribe to read the entire article.


DeepDyve is your
personal research library

It’s your single place to instantly
discover and read the research
that matters to you.

Enjoy affordable access to
over 18 million articles from more than
15,000 peer-reviewed journals.

All for just $49/month

Explore the DeepDyve Library

Search

Query the DeepDyve database, plus search all of PubMed and Google Scholar seamlessly

Organize

Save any article or search result from DeepDyve, PubMed, and Google Scholar... all in one place.

Access

Get unlimited, online access to over 18 million full-text articles from more than 15,000 scientific journals.

Your journals are on DeepDyve

Read from thousands of the leading scholarly journals from SpringerNature, Elsevier, Wiley-Blackwell, Oxford University Press and more.

All the latest content is available, no embargo periods.

See the journals in your area

DeepDyve

Freelancer

DeepDyve

Pro

Price

FREE

$49/month
$360/year

Save searches from
Google Scholar,
PubMed

Create lists to
organize your research

Export lists, citations

Read DeepDyve articles

Abstract access only

Unlimited access to over
18 million full-text articles

Print

20 pages / month

PDF Discount

20% off