The Manufacturers' Choice of Brand Policy under Successive Duopoly
(2002)
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- Abstract
- We propose a non-cooperative game in order to emphasize the strategic rationale in shaping the distribution systems. Compared with the received literature, we let manufacturers select wich retailer(s) will market their respective brand. This, together with retailers possibly being multi-product dealers, enlarges the set of distribution systems. Whether manufacturers employ two relatilers rather than one reflects the tradeoff between two conflicting effects, there is an output increase but more competition is established. High levels of product differenciation and not too large brand asymmetry are enough to incentive manufacturers introduce intra-brand competition. However, the well-known exclusive dealing system shows up for little product differentiation and low brand asymmetry. It is worth emphasizing that, if any type of exclusivity relationship ever occurs, it is the equilibrium outcome of a non-cooperative game in which neither manufacturers not retailers may impose any vertical clauses.
- Affiliations
Citations
Moner-Colonques, R., Sempere Monerris, J. J., & Urbano, A. (2002). The Manufacturers’ Choice of Brand Policy under Successive Duopoly (ECON Working Papers 2002/03). https://hdl.handle.net/2078.5/77125