Pricing and market conduct in a vertical relationship

Vetter, Henrik

doi:10.1007/s00712-017-0529-5

J. Econ.

2017

DOI: 10.1007/s00712-017-0529-5

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Pricing and market conduct in a vertical relationship

Henrik Vetter

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Cited by 7 publications

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References 12 publications

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“…The vertical transaction may determine market conduct downstream(Vetter 2017), or even be used for collusive purposes(Mendi 2009). 2 We discuss the case of price competition and two-part tariffs in Sect.…”

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confidence: 99%

Informal input suppliers, quality choice and welfare

Daga

Mendi

2021

J Econ

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This paper proposes a theoretical model in which a formal upstream firm competes against informal input suppliers, which constitute an alternative, albeit lower-quality input source for formal downstream firms. The existence of an alternative source increases competition in the industry, which tends to be welfare-increasing. However, it may also distort the incentives of the formal upstream firm to invest in quality upgrading. Assuming quantity competition downstream, we analyze how these incentives change and whether the negative welfare effect of a reduced investment by the upstream firm may more than offset the positive welfare effect of increased competition brought about by informal input suppliers. We find that there are parameter values such that this is the case, and welfare decreases if informal input suppliers are present. We analyze the robustness of this result to alternative modeling assumptions, such as price competition downstream and the use of two-part tariffs by the formal upstream firm.

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confidence: 99%

Informal input suppliers, quality choice and welfare

Daga

Mendi

2021

J Econ

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Commodity taxes and welfare under endogenous market conduct

Vetter

2017

J. Econ.

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Bargaining power and firm profits in asymmetric duopoly: an inverted-U relationship

Yoshida

2017

J. Econ.

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Pricing and market conduct in a vertical relationship

Cited by 7 publications

References 12 publications

Informal input suppliers, quality choice and welfare

Informal input suppliers, quality choice and welfare

Commodity taxes and welfare under endogenous market conduct

Bargaining power and firm profits in asymmetric duopoly: an inverted-U relationship

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