Resale Price Maintenance: An Economic Analysis of its Anticompetitive Potential

Roger Blair and Wenche Wang ()
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Wenche Wang: University of Florida

Review of Industrial Organization, 2017, vol. 50, issue 2, No 3, 153-168

Abstract: Abstract A decade ago, Leegin overruled Dr. Miles and subjected RPM to rule-of-reason treatment, under which the potential for anticompetitive conduct should be analyzed (rather than automatically assumed to be present). In its Leegin decision, the Supreme Court identified four ways in which RPM could be used to retard competition and consequently reduce consumer welfare: The first two involve the well-known concerns that RPM could be used to support either a manufacturer cartel or a dealer cartel; the last two involve unilateral conduct designed to foreclose entry or hinder smaller rivals. In this paper, we analyze these potentially harmful uses of RPM. We conclude that RPM does not pose a substantial anticompetitive threat.

Keywords: Antitrust; Resale price maintenance; Verticle agreements (search for similar items in EconPapers)
JEL-codes: L42 (search for similar items in EconPapers)
Date: 2017
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DOI: 10.1007/s11151-016-9559-3

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