Predatory accommodation: Below-cost pricing without exclusion in intermediate goods markets
Publication
, Journal Article
Marx, LM; Shaffer, G
Published in: RAND Journal of Economics
January 1, 1999
We show that below-cost pricing can arise in intermediate goods markets when a monopolist retailer negotiates sequentially with two suppliers of substitute products. Below-cost pricing by one supplier allows the retailer to extract rents from the second supplier. Thus, the retailer and one supplier can increase their joint profit at the expense of the second supplier. We consider the welfare implications of below-cost pricing (welfare can increase or decrease as a result of below-cost pricing) and provide suggestions for when the courts should view below-cost pricing in intermediate goods markets as anticompetitive and when they should not.
Duke Scholars
Altmetric Attention Stats
Dimensions Citation Stats
Published In
RAND Journal of Economics
DOI
ISSN
0741-6261
Publication Date
January 1, 1999
Volume
30
Issue
1
Start / End Page
22 / 43
Related Subject Headings
- Economics
- 3803 Economic theory
- 3802 Econometrics
- 3801 Applied economics
- 14 Economics
Citation
APA
Chicago
ICMJE
MLA
NLM
Marx, L. M., & Shaffer, G. (1999). Predatory accommodation: Below-cost pricing without exclusion in intermediate goods markets. RAND Journal of Economics, 30(1), 22–43. https://doi.org/10.2307/2556044
Marx, L. M., and G. Shaffer. “Predatory accommodation: Below-cost pricing without exclusion in intermediate goods markets.” RAND Journal of Economics 30, no. 1 (January 1, 1999): 22–43. https://doi.org/10.2307/2556044.
Marx LM, Shaffer G. Predatory accommodation: Below-cost pricing without exclusion in intermediate goods markets. RAND Journal of Economics. 1999 Jan 1;30(1):22–43.
Marx, L. M., and G. Shaffer. “Predatory accommodation: Below-cost pricing without exclusion in intermediate goods markets.” RAND Journal of Economics, vol. 30, no. 1, Jan. 1999, pp. 22–43. Scopus, doi:10.2307/2556044.
Marx LM, Shaffer G. Predatory accommodation: Below-cost pricing without exclusion in intermediate goods markets. RAND Journal of Economics. 1999 Jan 1;30(1):22–43.
Published In
RAND Journal of Economics
DOI
ISSN
0741-6261
Publication Date
January 1, 1999
Volume
30
Issue
1
Start / End Page
22 / 43
Related Subject Headings
- Economics
- 3803 Economic theory
- 3802 Econometrics
- 3801 Applied economics
- 14 Economics