Exclusive contracts with private information in successive differentiated oligopolies

Bakó, Barna (2013) Exclusive contracts with private information in successive differentiated oligopolies. Working Paper. Corvinus University of Budapest. (Submitted)

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The purpose of this article is to analyze the incentives of manufacturers to deal exclusively with retailers in bilaterally duopolistic industries with brand differentiation by manufacturers. In contrast with the previous literature, exclusive contracts are shown to generate higher profits for manufacturers and retailers selling highly differentiated products, who thus have an incentive to insist on exclusive contracting. However, if the products are close substitutes no exclusivity will emerge in equilibrium. Furthermore, we show that exclusive contracts decrease both consumer and social welfare.

Item Type:Monograph (Working Paper)
Uncontrolled Keywords:exclusive contracts, product di�erentiation, vertical integration, JEL Codes: L20, L42, K20, D43, D83
Projects:MTA-BCE Lendület" Strategic Interactions Research Group
ID Code:1439
Deposited By: Barna Bakó
Deposited On:05 Feb 2014 08:04
Last Modified:05 Feb 2014 08:04

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