This paper concerns the sale of a vertically differentiated good by a manufacturer to retailers that have market power when reselling to consumers. The contractual relationships between the manufacturer and individual retailers are characterized as ldquo;quasi-partnerships,rdquo; reflecting the...

We study the implications of different contractual forms in a market with an incumbent upstream monopolist and free downstream entry. We show that traditional conclusions regarding the desirability of linear contracts radically change when entry in the downstream market is endogenous rather than...

This paper proposes and tests a model of supermarket competition based upon John Sutton's (1991) endogenous fixed cost (EFC) framework. The relevance of the EFC framework to supermarket competition stems from the industry's surprisingly uniform competitive structure: irrespective of the size of...

We analyze empirically the allocation of rights and monetary incentives in automobile franchise contracts. All of these contracts substantially restrict the decision rights of dealers and grant manufacturers extensive rights to specify and enforce dealers' duties. The allocation of decision...

In this note, we investigate the causal link between market concentration and markups in a retail setting. We study the Washington retail cannabis industry, which features exogenous variation in market concentration that resulted from retail licenses being awarded via lotteries. We observe...

A building block of many models in empirical industrial organization is a characteristic space, where products are modeled as a bundle of characteristics over which consumers have preferences. The ability of such models to predict counterfactual outcomes depends on how well this characteristic...

We examine the implications of different contractual forms for welfare as well as for firms’ profits in a framework in which a vertically integrated firm sells its good to an independent downstream firm. Under downstream Bertrand competition, the standard result of the desirability of two-part...

Platform businesses have been pivotal in the rise of the digital economy. Amazon is one example of a platform taking on the role of a quasi-regulator; an entity that is able to determine the terms of interaction on the platform. This intermediary position entails the danger of anti-competitive...

Walmart is one of the most successful companies in the world. With more than $ 524 billion in 2020 revenue and 2.2 million employees, Walmart is the world's largest company by sales volume and is ranked 19th on the Forbes list of the world's largest public companies. Walmart serves nearly 265...

This paper examines the effects of decentralizing decision-making in multi-establishment firms. Using a unique dataset from the Liquor Control Board of Ontario (LCBO), we assess the impact of allowing store managers to control the inventory replenishment decisions of their stores. We first...