Resource title

Buyer Power and Supplier Incentives

Resource image

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Resource description

This paper argues that - in contrast to an often expressed view - the formation of larger and more powerful buyers need not reduce welfare by stifling suppliers´ incentives. If contracts are determined in bilateral negotiations, the presence of larger buyers may both increase suppliers´incentives for product improvement and induce suppliers to choose a more efficient technology. The paper also isolates two di¤erent channels by which larger buyers can obtain a discount.

Resource author

Roman Inderst, Christian Wey

Resource publisher

Resource publish date

Resource language

eng

Resource content type

text/html

Resource resource URL

http://hdl.handle.net/10419/18315

Resource license

Adapt according to the presented license agreement and reference the original author.