ARTICLE: PRICE DISCRIMINATION - NEGOCIABILITY OF GENERAL RETAIL CONDITIONS - RESALE-AT-A-LOSS - MARKETING PAYMENTS - REBATES - SUPPLIERS’ INVESTMENTS

Price discrimination and negociability of retail provisions: An economic analysis

This article surveys the conclusions of theoretical models evaluating the impact of a ban on price discrimination in input markets. Then it considers the potential gains associated with the negociability of general terms of sales, compared to a reform allowing retailers to diminish their resale-at-a-loss thresholds thanks to the inclusion of marketing payments and other rebates. Finally, it investigates two criticisms frequently addressed to the negociability reform: that related to exclusionary practices and that related to suppliers’ investments. The article concludes that control mechanisms less distorsive of competition would more adequately respond to these concerns.

*This article is an automatic translation of the original article, provided here for your convenience. Read the original article. Introduction 1. Discrimination refers to the sale of a good on different terms to different buyers. In the case of commercial relations between producers and distributors, a supplier discriminates between its different purchasers if the terms of the sale (price, terms of payment, etc.) are different for different distributors. One of the most common forms of discrimination is the granting of rebates to distributors buying large volumes ("volume rebates"). Another is the granting of rebates to undertakings which purchase all or a large proportion of the products of a given category from the same supplier ("exclusive rebates"). Also frequently used,

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Etienne Pfister, Price discrimination and negociability of retail provisions: An economic analysis, September 2008, Concurrences N° 3-2008, Art. N° 20634, www.concurrences.com

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