We propose a model describing consumer demand for a luxury good, in which the perceived quality of the good is related to its scarcity. We use this model to analyze the optimal production and price setting decisions of a luxury good manufacturer and contrast them with the decisions that would be...

Refusal to sell to 'unauthorised' dealers is an integral part of a selective distribution system. Under such a system manufacturers authorise only those dealers meeting their specific requirements. Where the market involved is 'reasonably competitive' it is widely recognised that manufacturers,...

This paper studies a model where exclusive dealing (ED) can both promote investment and foreclose a more efficient supplier. While investment promotion is usually regarded as a pro-competitive effect of ED, our paper shows that it may be the very reason why a contract that forecloses a more...