Arbeitspapier

Who benefits from resale-below-cost laws?

We investigate the effect of banning resale-below-cost offers. There are two retailers with heterogeneous bargaining positions in relation to a monopolistic manufacturer. Each retailer sells two goods: one procured from the monopolistic manufacturer and the other, from a competitive fringe. In equilibrium, banning resale-below-cost offers can decrease the retailers' prices. The ban can benefit the weak retailer in terms of bargaining position and increase the total consumer surplus, although it harms the dominant retailer and the monopolistic manufacturer. Contrary to the basic scenario, when the weak retailer is horizontally separated, the ban benefits the monopolistic manufacturer

Language
Englisch

Bibliographic citation
Series: ISER Discussion Paper ; No. 875

Classification
Wirtschaft
Oligopoly and Other Imperfect Markets
Monopolization; Horizontal Anticompetitive Practices
Marketing and Advertising: Government Policy and Regulation
Firm Behavior: Theory
Subject
Loss-leader Pricing
Channel Power
Vertical Relations

Event
Geistige Schöpfung
(who)
Matsushima, Noriaki
Miyaoka, Akira
Event
Veröffentlichung
(who)
Osaka University, Institute of Social and Economic Research (ISER)
(where)
Osaka
(when)
2013

Handle
Last update
10.03.2025, 11:42 AM CET

Data provider

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Object type

  • Arbeitspapier

Associated

  • Matsushima, Noriaki
  • Miyaoka, Akira
  • Osaka University, Institute of Social and Economic Research (ISER)

Time of origin

  • 2013

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