IDEAS home Printed from https://ideas.repec.org/a/bla/buecrs/v71y2019i3p416-427.html
   My bibliography  Save this article

On The Profitability Of Resale Price Maintenance When Demand Is Uncertain

Author

Listed:
  • Hao Wang

Abstract

A previous study finds that in a market where a manufacturer faces uncertain demand and sells to consumers through competitive retailers, the manufacture wishes to support adequate retail inventories by imposing resale price maintenance (RPM). I show that if retail inventories are allocated to consumers through first‐come‐first‐served rule rather than efficient rationing rule in the game with unconstrained retail competition, imposing RPM may not be profitable. It may not encourage more retail inventories either. RPM may also lower consumer surpluses and social welfare. This study casts some doubt on the demand uncertainty theory that supports RPM.

Suggested Citation

  • Hao Wang, 2019. "On The Profitability Of Resale Price Maintenance When Demand Is Uncertain," Bulletin of Economic Research, Wiley Blackwell, vol. 71(3), pages 416-427, July.
    • Handle: RePEc:bla:buecrs:v:71:y:2019:i:3:p:416-427
    DOI: 10.1111/boer.12183
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/boer.12183
    Download Restriction: no
    File URL: https://libkey.io/10.1111/boer.12183?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:buecrs:v:71:y:2019:i:3:p:416-427. See general information about how to correct material in RePEc.

    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.

    We have no bibliographic references for this item. You can help adding them by using 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://www.blackwellpublishing.com/journal.asp?ref=0307-3378 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.