On the economic geography of dual distribution — The case of McDonald’s in Germany

Nisa E. Freiwald, Steffen Juranek and Uwe Walz ()

Economics Letters, 2020, vol. 191, issue C

Abstract: We analyze the allocation of ownership in a franchise system by focusing on location-specific characteristics of the outlets. This study uses a comprehensive data set on McDonald’s restaurants in Germany to investigate the drivers of the decision on whether outlets are company-owned or franchised. We find strong evidence for the repeat-customer hypothesis by showing that outlets are significantly more likely to be company-owned when they are located at places with relatively few repeat customers. We observe the same for outlets that are closer to McDonald’s headquarters. Finally, we find pronounced clustering of multi-unit franchisees.

Keywords: Franchising; Dual distribution; Agency theory; Geo-locational data; Economic geography (search for similar items in EconPapers)
JEL-codes: L24 L81 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0165176520301117
Full text for ScienceDirect subscribers only

Related works:
Working Paper: On the economic geography of dual distribution - The case of McDonald’s in Germany (2019)
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:eee:ecolet:v:191:y:2020:i:c:s0165176520301117

DOI: 10.1016/j.econlet.2020.109140

Access Statistics for this article

Economics Letters is currently edited by Economics Letters Editorial Office

More articles in Economics Letters from Elsevier
Bibliographic data for series maintained by Catherine Liu ().