Slotting allowances and retail product variety under oligopoly

Stephen Hamilton and Robert Innes ()

Economics Letters, 2017, vol. 158, issue C, 34-36

Abstract: Slotting fees are lump-sum charges paid by manufacturers to retailers for shelf space. In this letter we examine the strategic effect of slotting allowances on product variety. In a spatial model where consumers each have unit demand for their preferred product variant and retailers jointly select prices and product variety, we show that variety is (1) under-provided without slotting contracts and (2) efficiently supplied under equilibrium slotting fees.

Keywords: Slotting fees; Vertical contracts; Product variety; Oligopoly (search for similar items in EconPapers)
JEL-codes: D43 L13 L14 (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Related works:
Working Paper: Slotting Allowances and Retail Product Variety under Oligopoly (2010)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:158:y:2017:i:c:p:34-36

DOI: 10.1016/j.econlet.2017.06.033

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