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| Draganska, Michaela; Klapper, Daniel; Villas-Boas, Sofia Berto. |
| This research aims to provide insights into the determinants of channel profitability and the relative power in the channel by considering consumer demand and the interactions between manufacturers and retailers in an equilibrium model. In a departure from the standard empirical channel literature, which assumes that manufacturers set wholesale prices unilaterally, we explicitly model the negotiations between manufacturers and retailers. To this end, we formulate a Nash bargaining game to determine wholesale prices and thus how margins are split in the channel. Equilibrium margins are thus a function of demand primitives and of retailer and manufacturer bargaining power. Bargaining power is itself a function of exogenous retail and manufacturer... |
| Tipo: Working or Discussion Paper |
Palavras-chave: Demand and Price Analysis; Industrial Organization; Research Methods/ Statistical Methods. |
| Ano: 2007 |
URL: http://purl.umn.edu/6054 |
