EconPapers    
Economics at your fingertips  
 

Demand Expansion and Price Premium Effects of Marketing Effort: Modeling and Comparative Analysis

Vinay Ramani () and Sanjeev Swami ()
Additional contact information
Vinay Ramani: Indian Institute of Management, Udaipur
Sanjeev Swami: Dayalbagh Educational Institute

Economics Bulletin, 2017, vol. 37, issue 2, 1234-1246

Abstract: In this paper, we compare the outcomes of demand expansion and price premium effects in a dyadic supply chain. We find that in the decentralized setting, the output and effort, as well as the profits of both the manufacturer and the retailer under a demand expansion scenario are lower than that under the price premium scenario. Surprisingly, we find that under both the cases of demand expansion and price premium, the profit of the manufacturer is greater than the profit of the retailer, even though it is only the manufacturer who incurs all the cost.

Keywords: Demand Expansion; Price Premium; Stackelberg Game; First Mover Advantage (search for similar items in EconPapers)
JEL-codes: D4 L1 (search for similar items in EconPapers)
Date: 2017-06-05
References: View references in EconPapers View complete reference list from CitEc
Citations Track citations by RSS feed

Downloads: (external link)
http://www.accessecon.com/Pubs/EB/2017/Volume37/EB-17-V37-I2-P111.pdf (application/pdf)

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:ebl:ecbull:eb-17-00155

Access Statistics for this article

More articles in Economics Bulletin from AccessEcon
Series data maintained by John P. Conley ().

 
Page updated 2017-09-29
Handle: RePEc:ebl:ecbull:eb-17-00155