We model firms as supplying utility directly to consumers. The equilibrium outcome of competition in utility space depends on the relationship pi(u) between profit and average utility per consumer. Public policy constraints on the "deals" firms may offer affect equilibrium outcomes via their...

We examine the impact of multiproduct nonlinear pricing on profit, consumer surplus and welfare in a duopoly. When consumers buy all their products from one firm (the one-stop shopping model), nonlinear pricing leads to higher profit and welfare, but often lower consumer surplus, than linear...