The balance of power between producers and retailers: a differentiation model

Marie-Laure Allain

No 2002034, Discussion Papers (REL - Recherches Economiques de Louvain) from Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES)

Abstract: This paper argues that the balance of power between producers and retailers depends on the relative degrees of differentiation at the two levels of the vertical structure. We propose an extension of Hotelling's model in which two producers, competing in prices with horizontally differentiated products, face two horizontally differentiated retailers also competing in prices. We study the setting of producers' and retailers' margins. We show that when retailers are more differentiated than producers, they dominate the relationship and their margin is higher than producers'.

Keywords: Vertical relationships; differentiation (search for similar items in EconPapers)
JEL-codes: L13 L22 (search for similar items in EconPapers)
Pages: 21
Date: 2002-09-01
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

Downloads: (external link)
http://sites.uclouvain.be/econ/DP/REL/2002034.pdf (application/pdf)

Related works:
Journal Article: The Balance of Power between Producers and Retailers; a Differentiation model (2002)
Working Paper: The Balance of Power Between Producers and Retailers: a Differentiation Model (2002)
Working Paper: The Balance of Power Between Producers and Retailers: A Differentiation Model (1999)
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:ctl:louvre:2002034

Access Statistics for this paper

More papers in Discussion Papers (REL - Recherches Economiques de Louvain) from Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES) Place Montesquieu 3, 1348 Louvain-la-Neuve (Belgium). Contact information at EDIRC.
Bibliographic data for series maintained by Sebastien SCHILLINGS ().