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Parallel Imports and Repair Services

Jota Ishikawa, Hodaka Morita and Hiroshi Mukunoki

No 6850, CESifo Working Paper Series from CESifo

Abstract: This study explores the effect of parallel imports (PIs) when the producer may discriminate repair and maintenance services against PI units. This service discrimination weakens intra-brand competition and reduces the degree of price convergence between countries. If the producer makes costly activities to improve the quality of the good, permitting PIs in the presence of the service discrimination could lower the quality, because lower quality leads to a larger price gap. Consequently, it is possible that prices increase, consumers lose, and welfare deteriorates in both countries. This negative welfare effect is more likely to emerge as trade liberalization proceeds.

Keywords: parallel imports; service discrimination; goods quality; welfare; trade liberalization (search for similar items in EconPapers)
JEL-codes: F12 F13 F10 D42 L41 (search for similar items in EconPapers)
Date: 2018
New Economics Papers: this item is included in nep-com and nep-int
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Related works:
Journal Article: Parallel imports and repair services (2020) Downloads
Working Paper: Parallel Imports and Repair Services (2017) Downloads
Working Paper: Parallel Imports and Repair Services (2015) Downloads
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