STACKELBERG LEADERSHIP IN A MARKETING CHANNEL

Steffen Jørgensen (), Simon-Pierre Sigué () and Georges Zaccour
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Steffen Jørgensen: Department of Organization and Management, University of Southern, Denmark
Simon-Pierre Sigué: Universidad de Los Andes, Bogota, Colombia

International Game Theory Review (IGTR), 2001, vol. 03, issue 01, 13-26

Abstract: This paper provides an answer to the question who should, if any, lead a marketing channel? We consider a channel consisting of one manufacturer and one retailer where each player controls his advertising rate and margin. Supposing that advertising has a carry over effect on demand, we adopt a dynamic model. Nash and Stackelberg equilibria are characterised and outcomes compared with an efficient coordinated solution. Our findings suggest that manufacturer's leadership reduces inefficiency in a channel and is more beneficial to the consumer.

JEL-codes: B4 C0 C6 C7 D5 D7 M2 (search for similar items in EconPapers)
Date: 2001
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Citations: View citations in EconPapers (20)

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DOI: 10.1142/S0219198901000282

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