Empirical Evidence on the Role of Nonlinear Wholesale Pricing and Vertical Restraints on Cost Pass-Through

Céline Bonnet, Pierre Dubois, Sofia Villas-Boas and Daniel Klapper
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Daniel Klapper: Lehrstuhl für Marketing, Goethe University

The Review of Economics and Statistics, 2013, vol. 95, issue 2, 500-515

Abstract: How a cost shock is passed through to final consumer prices may relate to nominal price stickiness and rigidities, the existence of nonadjustable cost components, strategic markup adjustments, or other contract terms along the supply distribution chain. This paper presents a simple framework to assess the potential role of nonlinear pricing contracts and vertical restraints, such as resale price maintenance or wholesale price discrimination in the supply chain, in explaining the degree of pass-through from upstream cost shocks in the ground coffee category to downstream retail prices. We find that resale price maintenance increases pass-through rate. © 2013 The President and Fellows of Harvard College and the Massachusetts Institute of Technology.

Keywords: nonlinear pricing; multiple manufacturers and retailers; ground coffee; pass-through; resale price maintenance; wholesale price discrimination (search for similar items in EconPapers)
JEL-codes: C13 L13 L41 (search for similar items in EconPapers)
Date: 2013
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Citations: View citations in EconPapers (67)

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Related works:
Working Paper: Empirical Evidence on the Role of Non Linear Wholesale Pricing and Vertical Restraints on Cost Pass-Through (2013)
Working Paper: Empirical Evidence on the Role of Non Linear Wholesale Pricing and Vertical Restraints on Cost Pass-Through (2011)
Working Paper: Empirical Evidence on the Role of Non Linear Wholesale Pricing and Vertical Restraints on Cost Pass-Through (2010)
Working Paper: Empirical evidence on the role of non linear wholesale pricing and vertical restraints on cost pass-through (2009)
Working Paper: Empirical Evidence on the Role of Non Linear Wholesale Pricing and Vertical Restraints on Cost Pass-Through (2009)
Working Paper: Empirical Evidence on the Role of Non Linear Wholesale Pricing and Vertical Restraints on Cost Pass-Through (2009)
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