The economic theory of quasi-exclusive territory
AbstractThis paper introduces the economic theory of gquasi-exclusive territory.h We consider vertical dealings with two upstream firms and four downstream firms that compete in two separate markets. Under quasi- exclusive territory, downstream firms are bound to pay additional charges when selling goods beyond their territorial areas. We find that with respect to the two-part tariffs comprising a marginal price and a fixed fee, quasi-exclusive territory is more beneficial for upstream firms and more harmful for consumers than conventional exclusive territory. Moreover, we note that quasi-exclusive territory is in practice in various vertical dealings and that its regulation is a difficult task.
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Bibliographic InfoPaper provided by EconWPA in its series Industrial Organization with number 0508002.
Length: 12 pages
Date of creation: 01 Aug 2005
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Note: Type of Document - pdf; pages: 12
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Exclusive territory; Quasi-exclusive territory; Vertical dealings; Two-part tariff;
Find related papers by JEL classification:
- D43 - Microeconomics - - Market Structure and Pricing - - - Oligopoly and Other Forms of Market Imperfection
- L22 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Organization and Market Structure
- L42 - Industrial Organization - - Antitrust Issues and Policies - - - Vertical Restraints; Resale Price Maintenance; Quantity Discounts
- R32 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Other Spatial Production and Pricing Analysis
This paper has been announced in the following NEP Reports:
- NEP-ALL-2005-08-13 (All new papers)
- NEP-COM-2005-08-13 (Industrial Competition)
- NEP-MIC-2005-08-13 (Microeconomics)
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.:
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