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dc.contributor.authorForos, Øystein
dc.contributor.authorHagen, Kåre Petter
dc.contributor.authorKind, Hans Jarle
dc.date.accessioned2009-09-22T08:02:58Z
dc.date.available2009-09-22T08:02:58Z
dc.date.issued2009-07
dc.identifier.issn0804-6824
dc.identifier.urihttp://hdl.handle.net/11250/163242
dc.description.abstractWe show how an upstream firm by using a price-dependent profit-sharing rule can prevent destructive competition between downstream firms that produce relatively close substitutes. With this rule the upstream firm induces the retailers to behave as if demand has become less price elastic. As a result, competing downstream firms will maximize aggregate total channel profit. When downstream firms are better informed about demand conditions than the upstream firm, the same outcome cannot be achieved by vertical restraints such as resale price maintenance (RPM). Price-dependent profit-sharing may also ensure that the downstream firms undertake efficient market expanding investments. The model is consistent with observations from the market for content commodities distributed by mobile networks.en
dc.language.isoengen
dc.publisherNorwegian School of Economics and Business Administration. Department of Economicsen
dc.relation.ispartofseriesDiscussion paperen
dc.relation.ispartofseries2009:9en
dc.subjectprofit-sharingen
dc.subjectvertical restraintsen
dc.subjectinvestmentsen
dc.titlePrice-dependent profit-sharing as a channel coordination deviceen
dc.typeWorking paperen
dc.subject.nsiVDP::Samfunnsvitenskap: 200::Økonomi: 210::Samfunnsøkonomi: 212en
dc.subject.nsiVDP::Samfunnsvitenskap: 200::Økonomi: 210::Bedriftsøkonomi: 213en


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