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Empirical Evidence on Conditional Pricing Practices

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  • Bogdan Genchev

    () (Boston College)

  • Julie Holland Mortimer

    () (Boston College)

Abstract

Conditional pricing practices allow the terms of sale between a producer and a downstream distributor to vary with the ability of the downstream firm to meet a set of conditions put forward by the producer. The conditions may require a downstream firm to accept minimum quantities or multiple products, to adhere to minimum market-share requirements, or even to deal exclusively with one producer. The form of payment from the producer to the downstream firm may take the form of a rebate, marketing support, or simply the willingness to supply inventory. The use of conditional pricing practices is widespread throughout many industries, and the variety of contractual forms used in these arrangements is nearly as extensive as the number of contracts.

Suggested Citation

  • Bogdan Genchev & Julie Holland Mortimer, 2016. "Empirical Evidence on Conditional Pricing Practices," Boston College Working Papers in Economics 908, Boston College Department of Economics.
  • Handle: RePEc:boc:bocoec:908
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    References listed on IDEAS

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    More about this item

    Keywords

    conditional pricing; terms of sale; downstream firm;

    JEL classification:

    • K11 - Law and Economics - - Basic Areas of Law - - - Property Law
    • K21 - Law and Economics - - Regulation and Business Law - - - Antitrust Law
    • L4 - Industrial Organization - - Antitrust Issues and Policies
    • L42 - Industrial Organization - - Antitrust Issues and Policies - - - Vertical Restraints; Resale Price Maintenance; Quantity Discounts

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