Vertical Relations - Tinbergen

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1Vertical Relations MoragaTerminology Manufucturervs. retailer Upstreamvs. downstream Intrabrandcompetition: competition between different retailers selling the same brand; Interbrandcompetition: competition between different Vertical structures2Vertical Relations Manufacturer-retailer vs. seller-buyerVariables beyond control:Prices to publicQualityPromotional effortAdvertising After-sales buyers demand, most variables relevant to a transaction under seller s control Various (more complex) contracts between Manufacturers and retailers are observed: price fixing exclusive dealing territorial restrictions These are Vertical restraints: Why?

3 What is worse than a monopoly? A chain of monopolies The double (or triple, or… ) marginalisation problem Double Marginalisation P Q …

  Relations, Vertical, Monopolies, Monopoly, Vertical relations