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Pricing decisions for complementary products with firms’ different market powers

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  • Wei, Jie
  • Zhao, Jing
  • Li, Yongjian
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    Abstract

    This article reports the results of a study that explores the pricing problems with regard to two complementary products in a supply chain with two manufacturers and one common retailer. The authors establish five pricing models under decentralized decision cases, including the MS-Bertrand, MS-Stackelberg, RS-Bertrand, RS-Stackelberg, and NG models, with consideration of different market power structures among channel members. By applying a game-theoretical approach, corresponding analytic solutions are obtained. Then, by comparing the maximum profits and optimal pricing decisions obtained in different decision cases, interesting and valuable managerial insights are established.

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    Bibliographic Info

    Article provided by Elsevier in its journal European Journal of Operational Research.

    Volume (Year): 224 (2013)
    Issue (Month): 3 ()
    Pages: 507-519

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    Handle: RePEc:eee:ejores:v:224:y:2013:i:3:p:507-519

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    Web page: http://www.elsevier.com/locate/eor

    Related research

    Keywords: Pricing; Complementary products; Market power; Stackelberg game;

    References

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