The balance of power between producers and retailers : a differentiation model
AbstractThis paper argues that the balance of power between producers and retailers depends on the relative degrees of differentiation at the two levels of the vertical structure. We propose an extension of Hotelling's model in which two producers, competing in prices with horizontally differentiated products, face two horizontally differentiated retailers also competing in prices. We study the setting of producers' and retailers' margins. We show that when retailers are more differentiated than producers, they dominate the relationship and their margin is higher than producers'.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES) in its series Discussion Papers (REL - Recherches Economiques de Louvain) with number 2002034.
Date of creation: 01 Sep 2002
Date of revision:
Vertical relationships; differentiation;
Other versions of this item:
- Marie-Laure Allain, 2002. "The Balance of Power between Producers and Retailers ; a Differentiation model," Recherches économiques de Louvain, De Boeck Université, vol. 68(3), pages 359-370.
- Marie-Laure Allain, 1999. "The Balance of Power Between Producers and Retailers : A Differentiation Model," Working Papers 99-17, Centre de Recherche en Economie et Statistique.
- L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
- L22 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Organization and Market Structure
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Mills, David E, 1995. "Why Retailers Sell Private Labels," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 4(3), pages 509-28, Fall.
- Katz, Michael L., 1989. "Vertical contractual relations," Handbook of Industrial Organization, in: R. Schmalensee & R. Willig (ed.), Handbook of Industrial Organization, edition 1, volume 1, chapter 11, pages 655-721 Elsevier.
- Vickner, Steven S. & Davies, Stephen P. & Fulton, Joan R. & Vantreese, Valerie L., 2000. "Estimating Market Power And Pricing Conduct For Private-Label And National Brands In A Product-Differentiated Oligopoly: The Case Of A Frozen Vegetable Market," Journal of Food Distribution Research, Food Distribution Research Society, vol. 31(02), July.
- Kourandi, Frago & Vettas, Nikolaos, 2010. "Endogenous Spatial Differentiation with Vertical Contracting," CEPR Discussion Papers 7948, C.E.P.R. Discussion Papers.
- Vanessa von Schlippenbach & Isabel Teichmann, 2011.
"The Strategic Use of Private Quality Standards in Food Supply Chains,"
Discussion Papers of DIW Berlin
1120, DIW Berlin, German Institute for Economic Research.
- Vanessa von Schlippenbach & Isabel Teichmann, 2012. "The Strategic Use of Private Quality Standards in Food Supply Chains," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 94(5), pages 1189-1201.
- von Schlippenbach, Vanessa & Teichmann, Isabel, 2012. "The strategic use of private quality standards in food supply chains," DICE Discussion Papers 62, Heinrich‐Heine‐Universität Düsseldorf, Düsseldorf Institute for Competition Economics (DICE).
- von Schlippenbach, Vanessa & Teichmann, Isabel, 2011. "The Strategic Use of Private Quality Standards in Food Supply Chains," 51st Annual Conference, Halle, Germany, September 28-30, 2011 114519, German Association of Agricultural Economists (GEWISOLA).
- Teichmann, Isabel & von Schlippenbach, Vanessa, 2011. "The Strategic Use of Private Quality Standards in Food Supply Chains," 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland 116079, European Association of Agricultural Economists.
- Bergès, Fabian & Chambolle, Claire, 2007.
"Threat of Exit as a Source of Bargaining Power,"
IDEI Working Papers
471, Institut d'Économie Industrielle (IDEI), Toulouse.
- Fabian Bergès & Claire Chambolle, 2009. "Threat of Exit as a Source of Bargaining Power," Discussion Papers (REL - Recherches Economiques de Louvain) 2009033, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Sebastien SCHILLINGS).
If references are entirely missing, you can add them using this form.