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Brand name and private label price setting by a monopoly store


  • Perloff, Jeffrey M.
  • LaFrance, Jeffrey T.
  • Chouinard, Hayley H.


A monopoly that sells to brand-name loyal customers and to price-sensitive customers must decide whether to carry both name-brand and private-label products and how much to charge. The monopoly may charge either more or less for the brand name if it carries a private label, and the price differential between the products is sensitive to cost and taste parameters.

Suggested Citation

  • Perloff, Jeffrey M. & LaFrance, Jeffrey T. & Chouinard, Hayley H., 2012. "Brand name and private label price setting by a monopoly store," Economics Letters, Elsevier, vol. 116(3), pages 508-511.
  • Handle: RePEc:eee:ecolet:v:116:y:2012:i:3:p:508-511 DOI: 10.1016/j.econlet.2012.04.062

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    References listed on IDEAS

    1. Michael B. Ward & Jay P. Shimshack & Jeffrey M. Perloff & J. Michael Harris, 2002. "Effects of the Private-Label Invasion in Food Industries," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 84(4), pages 961-973.
    2. Robert B. Barsky & Mark Bergen & Shantanu Dutta & Daniel Levy, 2003. "What Can the Price Gap between Branded and Private-Label Products Tell Us about Markups?," NBER Chapters,in: Scanner Data and Price Indexes, pages 165-228 National Bureau of Economic Research, Inc.
    3. Steven Salop, 1977. "The Noisy Monopolist: Imperfect Information, Price Dispersion and Price Discrimination," Review of Economic Studies, Oxford University Press, vol. 44(3), pages 393-406.
    4. Pradeep K. Chintagunta & André Bonfrer & Inseong Song, 2002. "Investigating the Effects of Store-Brand Introduction on Retailer Demand and Pricing Behavior," Management Science, INFORMS, vol. 48(10), pages 1242-1267, October.
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    More about this item


    Brand name; Private label; Monopoly; Pricing;

    JEL classification:

    • L2 - Industrial Organization - - Firm Objectives, Organization, and Behavior
    • D3 - Microeconomics - - Distribution
    • D4 - Microeconomics - - Market Structure, Pricing, and Design


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