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Buying power and strategic interactions

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Abstract:

Abstract.  This paper shows that buying power at the retail level can lead to a rise in wholesale price. As a result, retailers without buying power may increase their retail price. Nevertheless, total surplus is non‐decreasing in the degree of buying power possessed by the ‘dominant’ retailer. JEL classification: L13

French
Pouvoir d’achat et interactions stratégiques. 

Ce mémoire montre que le pouvoir d’achat au niveau du commerce de détail peut mener à un accroissement dans les prix de gros. En conséquence, les détaillants qui n’ont pas de pouvoir d’achat peuvent accroître leurs prix au détail. Néanmoins, le surplus total ne décroît pas à mesure que le degré de pouvoir d’achat du détaillant s’accroît.

Document Type: Research Article

DOI: http://dx.doi.org/10.1111/j.0008-4085.2005.00319.x

Affiliations: Competition Policy Branch, Competition Bureau

Publication date: November 1, 2005

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