Journal ArticleDOI
Vertical Restraints in a Model of Vertical Differentiation
Patrick Bolton,Giacomo Bonanno +1 more
TLDR
In this article, the authors consider the case of a manufacturer who sells a homogeneous good to retailers who compete in prices and post-sales services and show that the optimal linear-price contract is inefficient from the point of view of the vertical structure.Abstract:
We consider the case of a manufacturer who sells a homogeneous good to retailers who compete in prices and "cum-sales" or "post-sales" services. We show that the optimal linear-price contract is inefficient from the point of view of the vertical structure and that simple forms of vertical restraints, such as resale price maintenance and franchise fees, dominate the optimal linear-price contract, but do not restore vertical efficiency. Our analysis is concluded with the description of an efficient contract.read more
Citations
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Journal ArticleDOI
Channel Conflict and Coordination in the E‐Commerce Age
Andy A. Tsay,Narendra Agrawal +1 more
TL;DR: In this paper, the authors develop a model that captures key attributes of such a setting, including various sources of inefficiency, and identify a number of counterintuitive structural properties, and examine ways to adjust the manufacturer-reseller relationship that have been observed in industry.
Journal ArticleDOI
The choice of organizational form: Vertical financial ownership versus other methods of vertical integration
TL;DR: In this article, the authors synthesize theoretical arguments and empirical findings from this literature to identify the underlying advantages and disadvantages of choosing vertical financial ownership relative to vertical contracts, and provide a framework for making this analysis based on a synthesis of agency and transaction costs perspectives.
Book ChapterDOI
Chapter 11 Vertical contractual relations
TL;DR: In this article, the authors discuss the relationship between two parties at successive stages in the vertical chain of production and marketing for a good and describe the private and social incentives to utilize such contracts.
Journal ArticleDOI
Pull Promotions and Channel Coordination
Eitan Gerstner,James D. Hess +1 more
TL;DR: In this paper, a pull price promotion is proposed as a coordination device in an independent channel of distribution, and the pull price discounts are designed to target price-conscious consumers. And the pull with push strategy increases the probability of price coordination.
Journal ArticleDOI
Vertical Control and Price Versus Nonprice Competition
TL;DR: In this paper, the authors consider a manufacturer distributing a product through retailers who compete in price and service, which reduces the time it takes to purchase a good, and the mix of these instruments that maximizes collective profit is determined by the tastes of consumers on the "product margin", whereas decentralized retailers consider as well the tastes on the interretailer margins.