Chain Store Against Manufacturers: Regulation Can Mitigate Market Distortion

Bykadorov, Igor; Ellero, Andrea; Funari, Stefania; Kokovin, Sergey; Pudova, M. V.

doi:10.1007/978-3-319-44914-2_38

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2019

2022

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Cited by 12 publications

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“…We study two types of retailer behavior: with and without the condition of free entry (cf. [1][2][3]). The result is that when the retailer imposes an entrance fee for each producer, it leads to an increase in both social welfare and consumer surplus.…”

Section: Introductionmentioning

confidence: 99%

Monopolistic Competition Model With Entrance Fee

Tilzo

2022

UMJ

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We study the monopolistic competition model with producer-retailer-consumers two-level interaction. The industry is organized according to the Dixit–Stiglitz model. The retailer is the only monopolist. A quadratic utility function represents consumer preferences. We consider the case of the retailer's leadership; namely, we study two types of behavior: with and without the free entry condition. Earlier, we obtained the result: to increase social welfare and/or consumer surplus, the government needs to subsidize (not tax!) retailers. In the presented paper, we develop these results for the situation when the producer imposes an entrance fee for retailers.

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Section: Introductionmentioning

confidence: 99%