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Brand Name and Private Label Price Setting by a Monopoly Store

Author

Listed:
  • Jeffrey M. Perloff
  • Jeffrey LaFrance
  • Hayley H. Chouinard

Abstract

A monopoly that sells to brand-name loyal customers and to price-sensitive customers must decide whether to carry both name-brand and a private-label products and how much to charge. The monopoly may charge either more or less for the brand name if it carries a private label, and the price differential between the products is sensitive to cost and taste parameters.

Suggested Citation

  • Jeffrey M. Perloff & Jeffrey LaFrance & Hayley H. Chouinard, 2012. "Brand Name and Private Label Price Setting by a Monopoly Store," Monash Economics Working Papers 18-12, Monash University, Department of Economics.
    • Handle: RePEc:mos:moswps:2012-18
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    File URL: http://www.buseco.monash.edu.au/eco/research/papers/2012/1812brandnameperlofflafrance.pdf
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    References listed on IDEAS

    as
    1. Robert B. Barsky & Mark Bergen & Shantanu Dutta & Daniel Levy, 2003. "What Can the Price Gap between Branded and Private-Label Products Tell Us about Markups?," NBER Chapters, in: Scanner Data and Price Indexes, pages 165-225, National Bureau of Economic Research, Inc.
    2. Michael B. Ward & Jay P. Shimshack & Jeffrey M. Perloff & J. Michael Harris, 2002. "Effects of the Private-Label Invasion in Food Industries," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 84(4), pages 961-973.
    3. Pradeep K. Chintagunta & André Bonfrer & Inseong Song, 2002. "Investigating the Effects of Store-Brand Introduction on Retailer Demand and Pricing Behavior," Management Science, INFORMS, vol. 48(10), pages 1242-1267, October.
    4. Steven Salop, 1977. "The Noisy Monopolist: Imperfect Information, Price Dispersion and Price Discrimination," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 44(3), pages 393-406.
    5. I Horowitz, 2000. "An option-pricing look at the introduction of private labels," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 51(2), pages 221-230, February.
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    Cited by:

    1. Tsekouropoulos, Georgios & Koliouska, Christiana & Theocharis, Dimitrios & Andreopoulou, Zacharoula, 2018. "Green products: digital marketing and consumer behavior for sustainability," Agricultural Economics Review, Greek Association of Agricultural Economists, vol. 0(Issue 2).
    2. Weimin Ma & Rong Cheng & Hua Ke, 2018. "Impacts of Power Structure on Supply Chain with a Store Brand," Asia-Pacific Journal of Operational Research (APJOR), World Scientific Publishing Co. Pte. Ltd., vol. 35(04), pages 1-25, August.
    3. Georgios TSEKOUROPOULOS & Dimitrios THEOCHARIS & Christos SARMANIOTIS, 2019. "Consumer Behaviour and Factors Affecting the Selection of Green Private Label Products in Greek Retail Market," International Conference on Economic Sciences and Business Administration, Spiru Haret University, vol. 5(1), pages 204-213, November.
    4. Ratula Chakraborty, 2018. "Do Retailers Manipulate Prices to Favour Private Label over Brands?," Working Paper series, University of East Anglia, Centre for Competition Policy (CCP) 2018-02, Centre for Competition Policy, University of East Anglia, Norwich, UK..
    5. Paul W. Dobson & Ratula Chakraborty, 2014. "How Do National Brands And Store Brands Compete?," Working Paper series, University of East Anglia, Centre for Competition Policy (CCP) 2014-07, Centre for Competition Policy, University of East Anglia, Norwich, UK..

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    More about this item

    Keywords

    brand name; private label; monopoly; pricing;
    All these keywords.

    JEL classification:

    • L2 - Industrial Organization - - Firm Objectives, Organization, and Behavior
    • D3 - Microeconomics - - Distribution
    • D4 - Microeconomics - - Market Structure, Pricing, and Design

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