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http://hdl.handle.net/10419/57835
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| Title: | | Resale price maintenance and manufacturer competition for retail services  |
| Authors: | | Hunold, Matthias Muthers, Johannes |
| Issue Date: | | 2012 |
| Series/Report no.: | | ZEW Discussion Papers 12-028 |
| Abstract: | | We investigate the incentives of manufacturers to use resale price maintenance (RPM) when selling products through common retailers. In our model retailers provide product specific pre-sales services. If the competitive retail margins are low, each manufacturer fixes a minimum price to induce favorable retail services. With symmetric manufacturers, products are equally profitable in equilibrium and no product is favored as without RPM, but retail prices are higher. We show that minimum RPM can create a prisoner's dilemma for manufacturers without increasing, and possibly even decreasing the overall service quality. This challenges the service argument as an efficiency defense for RPM. |
| Subjects: | | biased sales advice common agency manufacturer dilemma matching retail service RPM vertical restraints |
| JEL: | | D83 L42 |
| Persistent Identifier of the first edition: | | urn:nbn:de:bsz:180-madoc-322458 |
| Document Type: | | Working Paper |
| Appears in Collections: | | Publikationen von Forscherinnen und Forschern des ZEW ZEW Discussion Papers
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