The Robinson–Patman Act and Vertical Relationships

Yonezawa, Koichi; Gómez, Miguel I.; Richards, Timothy J.

doi:10.1093/ajae/aaz049

Cited by 16 publications

(13 citation statements)

References 49 publications

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“…Albeit in a different setting (with linear tariffs),Yonezawa et al [2020] reach similar conclusions regarding the enforcement of RPA and its impact on small firms' profits.© 2022 The Editorial Board of The Journal of Industrial Economics and John Wiley & Sons Ltd. INPUT PRICE DISCRIMINATION, TWO-PART TARIFFS AND BARGAINING 1077…”

supporting

confidence: 59%

“…33 RPA has been heavily criticized by many antitrust lawyers, economists and legislators. In his, by now, famous book, The Antitrust Paradox, Robert Bork characterized RPA as 'antitrust's least glorious hour' (Bork [1978] p. 382; see also Blair and DePasquale [2014] and Yonezawa et al [2020]).…”

Section: A Ban On Input Price Discriminationmentioning

confidence: 99%

“…Contrary to the present paper, O'Brien [2014] focuses on linear contracts. For other contributions to the literature on discriminatory linear contracts, see, for example, Katz [1987], DeGraba [1990], Yoshida [2000], Inderst and Valletti [2009], Herweg and Müller [2012], Grennan [2013], Akgün and Chioveanu [2019] and Yonezawa et al [2020]. may depend on the identity of the supplier's partner in negotiations after a ban on discrimination.…”

Section: Introduction Price Discrimination In Inputmentioning

confidence: 99%

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Input Price Discrimination, Two‐Part Tariffs and Bargaining*

Pinopoulos

2022

The J Industrial Economics

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I investigate the welfare effects of input price discrimination when an upstream supplier bargains over secret two‐part tariffs with two cost‐asymmetric downstream firms. I find that these welfare effects depend on the identity of the supplier's partner in negotiations after the ban. When the supplier bargains the common contract with the more cost‐efficient firm, then a ban on discrimination may increase welfare. In that case, there is below‐cost pricing in the upstream market despite strategic complementarity in the downstream market. When the supplier bargains the common contract with the less cost‐efficient downstream firm, banning discrimination always decreases welfare.

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supporting

confidence: 59%

Section: A Ban On Input Price Discriminationmentioning

confidence: 99%

Section: Introduction Price Discrimination In Inputmentioning

confidence: 99%

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Input Price Discrimination, Two‐Part Tariffs and Bargaining*

Pinopoulos

2022

The J Industrial Economics

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“…Similarly, Yonezawa et al. (2020) reveal that wholesale prices for yogurt products in the United States differ among 33 unique product line and store combinations.…”

Section: Introductionmentioning

confidence: 95%

Interaction between manufacturer's wholesale pricing and retailers' price‐matching guarantees

Nalca,

Cai

2023

Production and Operations Management

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In practice, many retailers employ price‐matching guarantees (PMGs), committing to meet the price of an identical product at a competitor's outlet. Despite the profound linkage between retailers and manufacturers, existing literature has predominantly explored retailers' PMGs without contemplating the influence of manufacturers' wholesale pricing strategies. Employing a supply chain model comprising one manufacturer and two retailers, we scrutinize the implications of wholesale pricing—uniform or discriminatory—on supply chain members and consumers when retailers have the option to extend PMGs. Our analysis uncovers that retailers refrain from offering PMGs when the manufacturer is granted the discretion to set discriminatory wholesale prices—even if such offers align with the manufacturer's preferences. Conversely, under uniform wholesale pricing, PMGs thrive at equilibrium—even if the manufacturer opposes the practice—as long as the degree of demand or cost asymmetry between retailers and average hassle costs remains relatively modest. Although firms' preferences regarding PMGs vary, a Pareto zone exists where all entities prefer that either the efficient retailer under demand asymmetry or the inefficient retailer under cost asymmetry extends the PMG. Despite the potential advantages of PMGs for the more efficient retailer, the enforcement of uniform wholesale pricing diminishes supply chain profit, consumer welfare, and overall social welfare. The detrimental impacts on welfare owing to the imposition of uniform wholesale pricing persist, even amid the presence of hassle costs associated with price matching. Our findings thus instigate a dialogue for policymakers concerning the validity of regulating wholesale pricing when PMGs are in effect.

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“…Market‐distorting behaviors can exist despite the extreme bust to the economy that characterized the Great Recession. The food retail sector has characteristics that may threaten competition, such as entry barriers, price‐discrimination, collusion, and market division between competitors (Stiegert & Kim, 2009; Yonezawa et al, 2019). This may be particularly detrimental in nonmetropolitan counties, where slow population growth and higher poverty rates may also influence the number of firms in an area (Cleary et al, 2018; Cromartie, 2016).…”

Section: Introductionmentioning

confidence: 99%

Food retail profits, competition, and the Great Recession

Cleary

Chenarides

2022

Agribusiness

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We investigate the competitive effects of entry in the food retail sector in nonmetropolitan counties in the United States from 1998 to 2014. We pay particular attention to the period that covers the Great Recession, which disrupted market structure across a number of industries.Using a county-level panel dataset, we use a seminal entry model to infer the local competitive effects of entry in the food retail sector. We estimate entry thresholds over time, which we then use to describe the rate of decline in profit margins following subsequent entry via entry threshold ratios. We find that food retail firms required a smaller market size to break even during the Great Recession, perhaps pointing to higher profits, as consumers shifted purchases to food-at-home. This effect is shortlived for all but a single firm. The market threshold required to support a single food retail firm remains low throughout the post-recession recovery period. We also find that the second firm may not decrease profit margins, but that competition increases meaningfully with the third and fourth entrants. The increased competition during the Great Recession also appears to have persisted into the recovery period. [EconLit Citations: L18; Q18].

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The Robinson–Patman Act and Vertical Relationships

Cited by 16 publications

References 49 publications

Input Price Discrimination, Two‐Part Tariffs and Bargaining*

Input Price Discrimination, Two‐Part Tariffs and Bargaining*

Interaction between manufacturer's wholesale pricing and retailers' price‐matching guarantees

Food retail profits, competition, and the Great Recession

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