‘A Comparison of Wholesale and Agency Structures in Differentiated Markets’
March 12, 2015 Leave a comment
The CCP Seminar Series continues on Friday 13th March with the marvellously talented Liang Lu (CCP & ECO) presenting her research entitled ‘A Comparison of Wholesale and Agency Structures in Differentiated Markets‘. Liang joined the UEA School of Economics in October 2012 to undertake a PhD on the topic of ‘High-street and Luxury Collaborations’. Her research interests include Industrial Organization and Consumer Behaviour. An abstract for Liang’s presentation can be found below.
We compare the wholesale and agency structures characterizing a supply and distribution chain in a bilateral duopoly model with differentiation. Overall mark-up is lower and demand is higher under the agency structure of supplier pricing and retailer revenue sharing. We examine firms’ preferences: suppliers gain from the wholesale structure whereas retailers are better off under the agency structure as long as the level of supplier differentiation is not too low. That is, while high levels of differentiation at one layer of the market generally benefit firms at that layer and harm firms at the other under the wholesale structure, it is not necessarily so under the agency structure.
The seminar takes place from 13:00-14:00 in the Thomas Paine Study Centre, Room 1.03.