Quality Choices in a Vertical Structure: National Brands vs Private Labels in Grocery Retailing
The paper analyzes quality choices in a vertical structure involving a monopolist food manufacturer (national brand-NB producer) and a monopolist retailer supplying both the national brand as well as a private label (PL). The analysis is based on a threestage dynamic game. According to the results, in the Nash equilibrium the two players choose the maximum possible qualities for their products. This means that the B food manufacturer seeks the maximum product differentiation, while the LP retailer seeks the minimum product differentiation. The behavior of the two players appears to be consistent with actual developments in the food markets as well as with earlier empirical studies documenting the efforts of NB food manufacturers to increase product differentiation.
References listed on IDEAS
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, 1999. "Private Labels and Manufacturer Counterstrategies," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 26(2), pages 125-45, June.
- Avenel, E. & Caprice, S., 2006. "Upstream market power and product line differentiation in retailing," International Journal of Industrial Organization, Elsevier, vol. 24(2), pages 319-334, March.
When requesting a correction, please mention this item's handle: RePEc:ags:aergaa:118673. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (AgEcon Search)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.