EconPapers    
Economics at your fingertips  
 

Buyer Group and Buyer Power When Sellers Compete

Doh-Shin Jeon and Domenico Menicucci

No 14-543, TSE Working Papers from Toulouse School of Economics (TSE)

Abstract: We study how the formation of a buyer group affects buyer power when sellers compete and buyers operate in separate markets. Previous research (Inderst and Shaffer, 2007, and Dana, 2012) has considered a buyer group that can commit to an exclusive purchase and has found that the formation of a buyer group strictly increases buyer power unless buyers have identical preferences. In contrast, we assume that no commitment to exclusive purchases is possible. We find that the formation of a buyer group has no effect if each seller's cost function is concave. If it is strictly convex, the buyer group strictly reduces the buyers'total payoff as long as the Pareto-dominant equilibrium for sellers is played when a buyer group is formed.

Keywords: Buyer Group; Buyer Power; Competition in Non-linear Tariffs; Discriminatory Offers; Common Agency (search for similar items in EconPapers)
JEL-codes: D4 K21 L41 L82 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-com, nep-cta, nep-law and nep-mic
Date: 2014-11, Revised 2017-11
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
https://www.tse-fr.eu/sites/default/files/medias/doc/wp/io/wp_tse_543.pdf Full text (application/pdf)

Related works:
Working Paper: Buyer Group and Buyer Power When Sellers Compete (2017) Downloads
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:tse:wpaper:28819

Access Statistics for this paper

More papers in TSE Working Papers from Toulouse School of Economics (TSE) Contact information at EDIRC.
Bibliographic data for series maintained by ().

 
Page updated 2019-07-22
Handle: RePEc:tse:wpaper:28819