Abstract
We provide a novel theory of harm for resale price maintenance (RPM). In a model with two manufacturers and two retailers, we show that RPM facilitates manufacturer collusion when retailers have alternatives to selling a manufacturer's product. Because of the alternatives, manufacturers can only ensure that retailers sell their products by leaving sufficient retail margins. This restricts the wholesale price level even when the manufacturers collude. RPM allows colluding manufacturers to establish higher prices.
| Original language | English |
|---|---|
| Pages (from-to) | 1089-1113 |
| Number of pages | 25 |
| Journal | The Journal of Industrial Economics |
| Volume | 72 |
| Issue number | 3 |
| DOIs | |
| Publication status | Published - Sept 2024 |
Fields of science
- 303010 Health economics
- 502 Economics
- 502002 Labour economics
- 502009 Corporate finance
- 502021 Microeconomics
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- 504014 Gender studies
- 507016 Regional economy
- 405002 Agricultural economics
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- 502013 Industrial economics
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JKU Focus areas
- Sustainable Development: Responsible Technologies and Management