The economics of franchising

Patrick Rey

Working Papers from HAL

Abstract: The academic debate about the motivations for franchising and its impact on economic welfare is quite passionate. Roughly speaking, on one side markets are asserted to be competitive, so that new business practices can merge only if they improve economic efficiency; businessmen "know their business" better than economists or regulators do, and the best possible regulatory policy is no regulation at all. On the other side, it is advised to rule out any kind of arrangement which may restrict one party's freedom of trade - which is the case of practically any provision in a franchise contract. The controversy reflects the opposition between different schools of economic thought, but it also hinges on divergences in the appreciation of the context and of the horizon of the analysis.

Keywords: management; internal and EU commerce; domestic marketing; consumer affairs; management economics; gestion; économie (search for similar items in EconPapers)
Date: 1991
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Published in [Research Report] Institut de mathématiques économiques ( IME). 1991, 23 p., ref. bib. : dissem

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Working Paper: The Economics of Franchising (1991)
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