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Competition In or For the Field: Which Is Better? AgEcon
Engel, Eduardo M.R.A.; Fischer, Ronald; Galetovic, Alexander.
In many circumstances, a principal, who wants prices to be as low as possible, must contract with agents who would like to charge the monopoly price. This paper compares a Demsetz auction, which awards an exclusive contract to the agent bidding the lowest price (competition for the field) with having two agents provide the good under (imperfectly) competitive conditions (competition in the field). We obtain a simple sufficient condition showing unambiguously which option is best. The condition depends only on the shapes of the surplus function of the principal and the profit function of agents, and is independent of the particular duopoly game played ex post. We apply this condition to three canonical examples-procurement, royalty contracts and...
Tipo: Working or Discussion Paper Palavras-chave: Demsetz auction; Double marginalization; Franchising; Joint vs. separate auctions; Monopoly; Procurement; Dealerships; Royalty contracts; Research Methods/ Statistical Methods; D44; L12; L92.
Ano: 2002 URL: http://purl.umn.edu/28406
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Two-Part Tariffs versus Linear Pricing Between Manufacturers and Retailers: Empirical Tests on Differentiated Products Markets AgEcon
Bonnet, Céline; Dubois, Pierre; Simioni, Michel.
We present a methodology allowing to introduce manufacturers and retailers vertical contracting in their pricing strategies on a differentiated product market. We consider in particular two types of non linear pricing relationships, one where resale price maintenance is used with two part tariffs contracts and one where no resale price maintenance is allowed in two part tariffs contracts. Our contribution allows to recover price-cost margins from estimates of demand parameters both under linear pricing models and two part tariffs. The methodology allows then to test between different hypothesis on the contracting and pricing relationships between manufacturers and retailers in the supermarket industry using exogenous variables supposed to shift the...
Tipo: Conference Paper or Presentation Palavras-chave: Vertical contracts; Two part tariffs; Double marginalization; Collusion; Competition; Manufacturers; Retailers; Differentiated products; Water; Non nested tests; Industrial Organization; L13; L81; C12; C33.
Ano: 2006 URL: http://purl.umn.edu/25685
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