MFN Clauses and the Agency and Wholesale Models in Electronic Content Markets
نویسنده
چکیده
I investigate strategic interactions and market outcomes in the “agency model” and “wholesale model” of sales, and also most-favored-nation (MFN) clauses. MFN clauses have pro-competitive effects under the agency model, encouraging retail entry and investment, which may be especially important in new markets. Adopting the agency model can also have pro-competitive effects. Indeed, consumers always prefer this model despite the fact that it leads to initial price increases. I relate my results to events in the market for electronic books.
منابع مشابه
The Agency and Wholesale Models in Electronic Content Markets
I investigate strategic interactions and market outcomes in the “agency model” and “wholesale model” of sales. Adopting the agency model initially raises prices, and can (but need not) raise the profits of rival retailers. Nonetheless, consumers prefer the agency model. I relate my results to events in the market for electronic books. I investigate the “agency model” and “wholesale model” of sa...
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