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Exclusive territories in the presence of upstream competition

Author

Listed:
  • Takeshi Ikeda

    (Kobe International University)

  • Daisuke Nikae

    (Osaka City University)

Abstract

This paper investigates the effects of exclusive territories in the presence of upstream competition. We consider the vertical dealings among two upstream firms and four downstream firms and find that exclusive territories may be more beneficial for consumers and more harmful for producers than Cournot competition without exclusive territories. Moreover, social welfare is enhanced by imposing exclusive territories when the transport cost is not too low.

Suggested Citation

  • Takeshi Ikeda & Daisuke Nikae, 2006. "Exclusive territories in the presence of upstream competition," Economics Bulletin, AccessEcon, vol. 4(26), pages 1-6.
    • Handle: RePEc:ebl:ecbull:eb-06d40008
    as

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    References listed on IDEAS

    as
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    5. Toshihiro Matsumura, 2003. "Consumer‐benefiting exclusive territories," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 36(4), pages 1007-1025, November.
    6. Alexander, Cindy R & Reiffen, David, 1995. "Vertical Contracts as Strategic Commitments: How Are They Enforced?," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 4(4), pages 623-649, Winter.
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    Cited by:

    1. Takeshi Ebina & Toshihiro Matsumura & Daisuke Shimizu, 2009. "Mixed oligopoly and spatial agglomeration in quasi-linear city," Economics Bulletin, AccessEcon, vol. 29(4), pages 2722-2729.
    2. Toshihiro Matsumura & Noriaki Matsushima, 2012. "Spatial Cournot competition and transportation costs in a circular city," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 48(1), pages 33-44, February.

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    More about this item

    Keywords

    Exclusive territory;

    JEL classification:

    • D4 - Microeconomics - - Market Structure, Pricing, and Design
    • L4 - Industrial Organization - - Antitrust Issues and Policies

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