Consumer shopping costs as a cause of slotting fees: A rent-shifting mechanism

Arbeitspapier

Analyzing a sequential bargaining framework with one retailer and two suppliers of substitutable goods, we show that slotting fees may emerge as a result of a rent-shifting mechanism when consumer shopping costs are taken into account. If consumers economize on their shopping costs by bundling their purchases, their buying decision depends rather on the price for the whole shopping basket than on individual product prices. This induces complementarities between the goods offered at a retail outlet. If the complementarity effect resulting from shopping costs dominates the original substitution effect, the wholesale price negotiated with the first supplier is upward distorted in order to shift rent from the second supplier. As long as the first supplier has only little bargaining power, she compensates the retailer for the upward distorted wholesale price by paying a slotting fee. We also show that banning slotting fees causes per- unit price to fall and welfare to increase.

Angaben zum Objekt

• Sprache: Englisch

Verweise und Beziehungen

• Erschienen in: Series: DIW Discussion Papers ; No. 1012

Klassifikation und Themen

• Klassifikation: Wirtschaft ; Firm Organization and Market Structure ; Vertical Restraints; Resale Price Maintenance; Quantity Discounts
• Thema: Shopping costs ; rent-shifting ; slotting fees ; Einzelhandel ; Konsumgüterindustrie ; Lieferanten-Kunden-Beziehung ; Verkaufsförderung ; Sortiment ; Preis ; Rent Seeking ; Konsumentenverhalten ; Kosten ; Komplementärgut ; Theorie

Beteiligte, Orts- und Zeitangaben

• Ereignis: Geistige Schöpfung
• (wer): Caprice, Stéphane ; von Schlippenbach, Vanessa
• Ereignis: Veröffentlichung
• (wer): Deutsches Institut für Wirtschaftsforschung (DIW)
• (wo): Berlin
• (wann): 2010

Weitere Informationen

• Handle: http://hdl.handle.net/10419/36747
• Letzte Aktualisierung: 10.03.2025, 11:44 MEZ