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Discount Chains and Brand Policy

Tommy Gabrielsen () and Lars Sørgard

Scandinavian Journal of Economics, 1999, vol. 101, issue 1, 127-142

Abstract: Retail chains are observed in many industries. The question addressed here is whether retail chains can exploit buyer power by excluding some brands. In a theoretical model with two differentiated producers and a single retailer, we show that a retailer will require exclusivity (exclude a brand) if the brands are sufficiently symmetric in demand potential. Exclusivity will increase welfare if the excluded brand is a close substitute for the brand carried by the retailer. Our theoretical results are also set in relation to some findings from the Norwegian grocery industry. JEL Classification: L12; L42

Date: 1999
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https://doi.org/10.1111/1467-9442.00145

Related works:
Working Paper: Discount Chains and Brand Policy (1999)
Working Paper: Discount Chains and Brand Policy (1994)
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