Loyalty discounts, offered to customers that meet purchase thresholds, can shift share from rival firms. In a differentiated product duopoly, only one firm employs a program that customers adopt in equilibrium. Whenever consumers strongly prefer the product of said firm, such discounts increase...

This paper studies the impact of a dominant firm's conditional discounts on competitors' learning-by-doing. In a vertical context where a dominant upstream supplier and a competitive fringe sell their products to a single downstream firm, we analyze whether the dominant supplier prefers to off...

This paper studies the impact of a dominant firm's conditional discounts on competitors' learning-by-doing. In a vertical context where a dominant upstream supplier and a competitive fringe sell their products to a single downstream firm, we analyze whether the dominant supplier prefers to offer...

The antitrust law of bundled discounts is unsettled. LePage's broadly condemned bundled discounts instituted by a dominant firm where it appeared that the discounts served no economic purpose other than to place rival, single product suppliers at a competitive disadvantage. In contrast,...

The discussion regarding what should be the proper legal treatment for loyalty discounts (alsoknown as “fidelity discounts” or “loyalty rebates”) in antitrust law is characterized by a stronglack of consensus among enforcement authorities and scholars, being no agreement as to whetherit...

There are well-documented episodes for which prices remained at supracompetitive levels even after a cartel had been shut down by the competition authority. As long as market conditions remain reasonably stable, it is quite possible that collusive prices will still be incentive compatible so the...

In a setting where retailers and suppliers compete for each other by offering binding contracts, exclusivity clauses serve as a competitive device. As a result of these clauses, firms addressed by contracts only accept the most favorable deal. Thus the contract-issuing parties have to squeeze...