We consider a two-period model with two sellers and one buyer in which the ecient outcome calls for the buyer to purchase one unit from each seller in each period. We show that when the buyer's valuations between periods are linked by switching costs and at least one seller is nancially constrained, there are plausible conditions under which exclusion arises as the unique equilibrium outcome (the buyer buys both units from the same seller). The exclusionary equilibria are supported by price-quantity o ers in which the excluding seller o ers its second unit at a price that is below its marginal cost of production. In some cases, the price of this second unit is negative. Our ndings contribute to the literatures on exclusive dealing, bundling, and loyalty rebates/payments.
