Optimal Monetary Provisions in Plural Form Franchise Systems; A Theoretical Model of Incentives with Two Risk-Averse Agents
Empirical studies show that most franchise chains use dual distribution - or a plural form franchise system - characterized by the coexistence of franchised units and company- owned retail units in the same distribution network. Therefore, this paper focuses on dual distribution and considers the di fferent contractual arrangements in this type of franchise system. The paper contributes to the theoretical eff orts at developing a model to study the optimal determination of the share parameters (commission and royalty rates) in a mixed system.
|Date of creation:||06 Jun 2013|
|Date of revision:|
|Note:||View the original document on HAL open archive server: https://halshs.archives-ouvertes.fr/halshs-00830899|
|Contact details of provider:|| Web page: https://hal.archives-ouvertes.fr/|
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.:
- James A. Brickley, 2002. "Royalty Rates and Upfront Fees in Share Contracts: Evidence from Franchising," Journal of Law, Economics and Organization, Oxford University Press, vol. 18(2), pages 511-535, October.
- Macho-Stadler, Ines & Perez-Castrillo, J. David, 2001.
"An Introduction to the Economics of Information: Incentives and Contracts,"
Oxford University Press,
edition 2, number 9780199243273, July.
- Macho-Stadler, Ines & Perez-Castrillo, J. David, 2001. "An Introduction to the Economics of Information: Incentives and Contracts," OUP Catalogue, Oxford University Press, edition 2, number 9780199243259, July.
- Gallini, Nancy T & Lutz, Nancy A, 1992. "Dual Distribution and Royalty Fees in Franchising," Journal of Law, Economics and Organization, Oxford University Press, vol. 8(3), pages 471-501, October.
- Sugato Bhattacharyya & Francine Lafontaine, 1995. "Double-Sided Moral Hazard and the Nature of Share Contracts," RAND Journal of Economics, The RAND Corporation, vol. 26(4), pages 761-781, Winter.
- Thierry Pénard & Emmanuel Raynaud & Stéphane Saussier, 2011.
"Monitoring Policy and Organizational Forms in Franchised Chains,"
International Journal of the Economics of Business,
Taylor & Francis Journals, vol. 18(3), pages 399-417, November.
- Thierry Pénard & Emmanuel Raynaud & Stéphane Saussier, 2011. "Monitoring policy and organizational forms in franchised chains," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) halshs-00656123, HAL.
- Chong-En Bai & Zhigang Tao, 2000. "Contract Mixing in Franchising as a Mechanism for Public-Good Provision," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 9(1), pages 85-113, 03.
- Blair,Roger D. & Lafontaine,Francine, 2005.
"The Economics of Franchising,"
Cambridge University Press, number 9780521772525, 1.
- Brickley, James A. & Dark, Frederick H., 1987. "The choice of organizational form The case of franchising," Journal of Financial Economics, Elsevier, vol. 18(2), pages 401-420, June.
- Francine Lafontaine & Kathryn L. Shaw, 2001.
"Targeting Managerial Control: Evidence from Franchising,"
NBER Working Papers
8416, National Bureau of Economic Research, Inc.
- Francine Lafontaine & Kathryn L. Shaw, 2005. "Targeting Managerial Control: Evidence from Franchising," RAND Journal of Economics, The RAND Corporation, vol. 36(1), pages 131-150, Spring.
- Luis Vázquez, 2005. "Up-front Franchise Fees and Ongoing Variable Payments as Substitutes: An Agency Perspective," Review of Industrial Organization, Springer, vol. 26(4), pages 445-460, 06.
- Tracy R. Lewis & Huseyin Yildirim, 2002. "Learning by Doing and Dynamic Regulation," RAND Journal of Economics, The RAND Corporation, vol. 33(1), pages 22-36, Spring.
- Etro, Federico, 2011.
"Endogenous market structures and contract theory: Delegation, principal-agent contracts, screening, franchising and tying,"
European Economic Review,
Elsevier, vol. 55(4), pages 463-479, May.
- Etro Federico, 2010. "Endogenous Market Structures and Contract Theory. Delegation, principal-agent contracts, screening, franchising and tying," Working Papers 2010_25, Department of Economics, University of Venice "Ca' Foscari".
- Hempelmann, Bernd, 2006. "Optimal franchise contracts with private cost information," International Journal of Industrial Organization, Elsevier, vol. 24(2), pages 449-465, March.
- Francine Lafontaine, 1992. "Agency Theory and Franchising: Some Empirical Results," RAND Journal of Economics, The RAND Corporation, vol. 23(2), pages 263-283, Summer.
When requesting a correction, please mention this item's handle: RePEc:hal:wpaper:halshs-00830899. 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: (CCSD)
If references are entirely missing, you can add them using this form.