Journal article

Authors list: Paha, Johannes

Publication year: 2023

Pages: 1121-1145

Journal: The Journal of Industrial Economics

Volume number: 71

Issue number: 4

ISSN: 0022-1821

eISSN: 1467-6451

Open access status: Hybrid

DOI Link: https://doi.org/10.1111/joie.12350

Publisher: Wiley

Abstract: 
A monopolistic manufacturer produces a branded good that is sold to final consumers by a monopolistic retailer who also sells a private label. The costs of the private label are unobserved by the manufacturer, which affects the terms of the contract offered by the manufacturer to the retailer. Given the revelation principle, the manufacturer distorts the quantity of the branded product downwards to learn those costs. The manufacturer can further reduce the retailer's information rent by distorting the quantity of the private label upwards-but this quantity is typically beyond its control. The optimum can nonetheless be achieved when combining a quantity discount with an end-of-year repayment.

Harvard Citation style: Paha, J. (2023) Wholesale Pricing with Asymmetric Information about a Private Label, The Journal of Industrial Economics, 71(4), pp. 1121-1145. https://doi.org/10.1111/joie.12350

APA Citation style: Paha, J. (2023). Wholesale Pricing with Asymmetric Information about a Private Label. The Journal of Industrial Economics. 71(4), 1121-1145. https://doi.org/10.1111/joie.12350