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Economic Rationales of Exclusive Dealing ; Empirical Evidence from the French Distribution Networks

Author

Listed:
  • Muriel Fadairo

    (Université de Lyon, Lyon, F-69007, France ; CNRS, GATE Lyon St Etienne,F-69130 Ecully, France, Université Jean Monnet, Saint-Etienne, F-42000, France)

  • Jianyu Yu

    (Research Institute of Economics and Management, Southwest University of Economics and Finance, Chengdu, Sichuan, China, 610074)

Abstract

This paper investigates the rationales of exclusive dealing (ED), which is one of the most common forms of vertical restraint and attracts intense policy debates in anti-trust regulations. Based on a survey of the theoretical literature, we derive several hypotheses relative to the anti- and pro-competitive motivations of ED. These hypotheses are submitted to French data regarding several types of distribution networks in a wide range of sectors. Considering the industry features, our empirical analysis indicates that in the French distribution system, ED contracts tend to be procompetitive. The evidence suggests that the motivation of ED mainly lies in its positive role to foster the investment of upstream firms.

Suggested Citation

  • Muriel Fadairo & Jianyu Yu, 2014. "Economic Rationales of Exclusive Dealing ; Empirical Evidence from the French Distribution Networks," Working Papers 1405, Groupe d'Analyse et de Théorie Economique Lyon St-Étienne (GATE Lyon St-Étienne), Université de Lyon.
    • Handle: RePEc:gat:wpaper:1405
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    1. Chiara Fumagalli & Massimo Motta & Lars Persson, 2009. "On The Anticompetitive Effect Of Exclusive Dealing When Entry By Merger Is Possible," Journal of Industrial Economics, Wiley Blackwell, vol. 57(4), pages 785-811, December.
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    More about this item

    Keywords

    Exclusive dealing; Vertical restraints; Competition policy;
    All these keywords.

    JEL classification:

    • C12 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Hypothesis Testing: General
    • L42 - Industrial Organization - - Antitrust Issues and Policies - - - Vertical Restraints; Resale Price Maintenance; Quantity Discounts

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