EconPapers    
Economics at your fingertips  
 

Contract Mixing in Franchising as a Mechanism for Public‐Good Provision

Chong-En Bai and Zhigang Tao ()

Journal of Economics & Management Strategy, 2000, vol. 9, issue 1, 85-113

Abstract: This paper is concerned with the coexistence of company‐owned units and franchised units in business format franchising and their different contractual arrangements. Drawing insights from case studies that indicate both the development and the maintenance of company‐wide brand names and unit‐specific sales activities are crucial to a franchise company, we construct a multitask model to account for such contract mixing in franchising. Intuitively, low‐powered contracts are offered to some managers to induce effort for brand‐name development and maintenance, while high‐powered contracts are offered to the remaining managers to elicit sales activity and capture the beneficial effect of the company brand name. Franchising can thus be viewed as an organizational agreement for production involving brand‐name products and services.

Date: 2000
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (22) Track citations by RSS feed

Downloads: (external link)
https://doi.org/10.1111/j.1430-9134.2000.00085.x

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bla:jemstr:v:9:y:2000:i:1:p:85-113

Ordering information: This journal article can be ordered from
http://www.blackwell ... ref=1058-6407&site=1

Access Statistics for this article

More articles in Journal of Economics & Management Strategy from Wiley Blackwell
Bibliographic data for series maintained by Wiley Content Delivery ().

 
Page updated 2021-06-20
Handle: RePEc:bla:jemstr:v:9:y:2000:i:1:p:85-113