This paper investigates the vertical relations in the Italian retail gasoline industry to study their effects on the retail price. The retailer, in presence of a quantity-decreasing unit discount scheme on the gasoline purchased, has to decide whether to follow the retail price recommended by...

We consider vertical price restrictions like Recommended Retail Prices (RRP) and Resale Price Maintenance (RPM), together with a retailer’s unit discount when purchasing the good from the manufacturer. We study how retailer’s buyer power affects the nature of the vertical price restriction...