Arbeitspapier
Why Parallel Trade May Raise Producers' Profits
This paper shows that a manufacturer may benefit from parallel trade. In addition to an intuitive condition about the effect of demand shocks, this occurs when competitive retailers must order inventories before they know the realization of demand and for products whose sale value drops at the end of the demand period. For these types of products, letting retailers trade unsold inventories generally results in larger orders placed with the manufacturer, higher manufacturer profit and higher consumer surplus. The model provides a simple explanation as to why the volume of parallel trade is now very large and accepted by manufacturers for some products such as automobiles, clothes, toys, consumer electronics, musical recordings, cosmetics and perfumes.
- Sprache
-
Englisch
- Erschienen in
-
Series: Economics Working Paper ; No. 2005-07
- Klassifikation
-
Wirtschaft
Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
- Thema
-
parallel trade
distribution
Kompensationsgeschäft
Monopol
Einzelhandel
Internationaler Wettbewerb
Gewinn
Wohlfahrtseffekt
Theorie
- Ereignis
-
Geistige Schöpfung
- (wer)
-
Raff, Horst
Schmitt, Nicolas
- Ereignis
-
Veröffentlichung
- (wer)
-
Kiel University, Department of Economics
- (wo)
-
Kiel
- (wann)
-
2005
- Handle
- Letzte Aktualisierung
-
10.03.2025, 11:42 MEZ
Datenpartner
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Objekttyp
- Arbeitspapier
Beteiligte
- Raff, Horst
- Schmitt, Nicolas
- Kiel University, Department of Economics
Entstanden
- 2005
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