Exclusive territories in the presence of upstream competition

Takeshi Ikeda (ikeda@kobe-kiu.ac.jp) and Daisuke Nikae (nikae04@econ.osaka-cu.ac.jp)
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Takeshi Ikeda: Kobe International University
Daisuke Nikae: Osaka City University

Economics Bulletin, 2006, vol. 4, issue 26, 1-6

Abstract: This paper investigates the effects of exclusive territories in the presence of upstream competition. We consider the vertical dealings among two upstream firms and four downstream firms and find that exclusive territories may be more beneficial for consumers and more harmful for producers than Cournot competition without exclusive territories. Moreover, social welfare is enhanced by imposing exclusive territories when the transport cost is not too low.

Keywords: Exclusive; territory (search for similar items in EconPapers)
JEL-codes: D4 L4 (search for similar items in EconPapers)
Date: 2006-08-07
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Citations: View citations in EconPapers (2)

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