Exclusive contracts when the incumbent can establish a direct retailer

Hiroshi Kitamura; Misato Sato; Koki Arai

doi:10.1007/s00712-013-0335-7

Exclusive contracts when the incumbent can establish a direct retailer

Hiroshi Kitamura, Misato Sato, Koki Arai

Research output: Contribution to journal › Article

2 Citations (Scopus)

Abstract

This paper constructs a model of anticompetitive exclusive dealings with potential downstream competition. Unlike in previous studies, the incumbent can establish a direct retailer with some fixed payment and can offer an exclusive contract to a downstream buyer twice. We show that the existence of these two options helps the incumbent deter socially efficient entry and earn almost monopoly profits even in the absence of scale economies and downstream competition.

Original language	English
Pages (from-to)	47-60
Number of pages	14
Journal	Journal of Economics/ Zeitschrift fur Nationalokonomie
Volume	112
Issue number	1
DOIs	https://doi.org/10.1007/s00712-013-0335-7
Publication status	Published - May 1 2014
Externally published	Yes

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Keywords

Direct retailers
Exclusive dealing
Two offers
Vertical relation

ASJC Scopus subject areas

Business, Management and Accounting(all)
Economics and Econometrics

Cite this

Kitamura, H., Sato, M., & Arai, K. (2014). Exclusive contracts when the incumbent can establish a direct retailer. Journal of Economics/ Zeitschrift fur Nationalokonomie, 112(1), 47-60. https://doi.org/10.1007/s00712-013-0335-7

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10.1007/s00712-013-0335-7