The Impact of Upfront Payments on Assortment Decisions in Retailing

Pio Baake and Vanessa Schlippenbach ()

Review of Industrial Organization, 2014, vol. 44, issue 1, 95-111

Abstract: There is a contentious debate about the exclusionary effects of upfront payments to be made by manufacturers to place their products on retailers’ shelves. Analyzing a two-stage bargaining process with one downstream retailer and a pool of upstream manufacturers, we find that upfront payments lead to a smaller assortment if the retailer’s bargaining power is high enough and the suppliers’ products are close substitutes. Copyright Springer Science+Business Media New York 2014

Keywords: Buyer power; Upfront payments; Retailing (search for similar items in EconPapers)
Date: 2014
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DOI: 10.1007/s11151-013-9407-7

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