Demand Uncertainty, Inventories, and Resale Price Maintenance

Autor:	James Peck, Raymond Deneckere, Howard P. Marvel
Rok vydání:	1996
Předmět:	TheoryofComputation_MISCELLANEOUS ComputingMilieux_GENERAL Microeconomics Economics and Econometrics Discounting Resale price maintenance Demand curve ComputerApplications_GENERAL Retail market Economics Derived demand Consumer welfare
Zdroj:	The Quarterly Journal of Economics. 111:885-913
ISSN:	1531-4650 0033-5533
DOI:	10.2307/2946675
Popis:	We show that a manufacturer facing uncertain demand and selling through a competitive retail market may wish to support adequate retail inventories by preventing the emergence of discount retailers. In our model, discounters offer low prices made possible by low probability of being saddled with unsold inventories in the event of slack demand. Full-price retailers are compensated for a higher probability of unsold inventories by a higher retail price when they sell. We show that preventing discounting increases the manufacturer's wholesale demand and profits, and we delineate demand conditions under which equilibrium inventory holding and consumer welfare increase.
Databáze:	OpenAIRE
Externí odkaz:	https://explore.openaire.eu/search/publication?articleId=doi_________::82a4fe8584d02a8727a5df2ea382b2eb https://doi.org/10.2307/2946675 Zobrazit plný text záznamu Plný text ve formátu PDF