Resale Price Maintenance: Customer Service Without Free Riding
Abstract
Recent judicial legalizations of resale price maintenance (RPM) allow a manufacturer to establish limits to the prices that its retailers charge: a maximum price (a ceiling) or a minimum price (a floor). A manufacturer can also choose not to apply an RPM constraint. To determine how RPM affects service levels and the distribution of profit between channel members, we derive the optimal RPM strategy for a manufacturer that sells through competing...
Paper Details
Title
Resale Price Maintenance: Customer Service Without Free Riding
Published Date
Dec 1, 2020
Journal
Volume
96
Issue
4
Pages
563 - 577
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