An analysis of UK franchise contracting 1989-1999

Jonathan S. Seaton
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Jonathan S. Seaton: Department of Economics, Loughborough University, Loughborough, Leicestershire, LE113 TU, UK, Postal: Department of Economics, Loughborough University, Loughborough, Leicestershire, LE113 TU, UK

Managerial and Decision Economics, 2003, vol. 24, issue 1, 25-34

Abstract: This paper examines UK franchise contracts over the period 1989-1999. Franchising is modelled as comprising three main variables, contract length, royalty rate and initial franchise fee. Up to now most authors have concentrated on the latter two variables, but with the data in this paper it is possible to assess the characteristics that impact on all three. Further, our analysis looks at what affects the probability of contract change. We take account of the limited dependent variable nature of the data and exploit sectoral heterogeneity. Our main findings are that the focus of attention on 'aggregate' variables is inappropriate and that contract length appears to be an important aspect of the franchise contract which is theoretically obvious, but until now has not been empirically tested. Copyright © 2003 John Wiley & Sons, Ltd.

Date: 2003
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Persistent link: https://EconPapers.repec.org/RePEc:wly:mgtdec:v:24:y:2003:i:1:p:25-34

DOI: 10.1002/mde.1102

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