The effects of vertical restraints under demand uncertainty -the model of one manufacturer with two retailers

• Main Authors: Wei-Zhang Lin, 林偉彰
• Other Authors: Yi-Heng Cheng
• Format: Others
• Language: zh-TW
• Published: 1995
• Online Access: http://ndltd.ncl.edu.tw/handle/44321595537668549235

碩士 === 淡江大學 === 產業經濟研究所 === 83 === The phenomenon that there often exists vertical restraints contract between the manufacturer and the retailers has been an interesting subject to economists for a long time. Most of vertical restraints are always prohibited by antitrust law. However, it seems that manufacturers are not detered and continue to violate the law once they got a chance. Therefore the effect of vertical restraints on the manufacturers profits and the social welfare become an portant subject in this fiield. There are many literaturs about vertical restraints. But only a few of them recently involve incomplete information.The purpose of this paper is to explore the situation when there exists incomplete information in vertical relationships and horizontal relationships. We set up a model with one monopolistic manufacturer and two competitive retailers who face an uncertain demand. Two retailers can have either sysmmetric information or asymmetric information. By entailing machanism informational transmissio n between manufacturer and retailers, the effects of vertical restraints （ FF,RPM,ET ） on manufacturer''s profit as well as social welfare are discussed. We find that whether the information on retail market is symmetric or not, only RPM can reproduce the outcome of vertical intergration for manufacturer. When the retail market is Cournot competition, RPM is the best from the manufacturer and society. FF can also attain the objectives of manufacturer and society, only when the retail market is asymmetric case. When two retailers behave as Bertrand competition, from the viewpoint of manufacturer, RPM is better than competition. But competition is better t han any vertical restraint contract from the viewpoint of society. Therefore the two retailers behave as Bertrand competitiors, there exists the conflict between private and social objectives.