MULTIPRODUCT NONLINEAR PRICING WITH MULTIPLE TASTE CHARACTERISTICS

We analyze optimal multiproduct nonlinear prices in the case where con sumer tastes are characterized by more than one taste parameter We pre sent conditions under which the optimal nonlinear price schedule can b e computed by finding optimal price schedules separately for each mark et. If so, they are unbundled; if not, they are bundled. Bundling is w eakly superior to unbundling and is strictly superior when a condition that we term uniform ordering of demand curves is weakly violated. Wi th uniform ordering of demand curves, multiproduct nonlinear prices ha ve the same features as single-product ones. Without this condition it is easy to construct examples that contradict some well-known results from the standard literature in mechanism design.