An Economic Approach to Article 82

This report argues in favour of an economics-based approach to Article 82, in a way similar to the reform of Article 81 and merger control. In particular, we support an effects-based rather than a form-based approach to competition policy. Such an approach focuses on the presence of anti-competitive effects that harm consumers, and is based on the examination of each specific case, based on sound economics and grounded on facts

An Economic Approach to Article 82 - Report by the European Advisory Group on Competition Policy

This report argues in favour of an economics-based approach to Article 82, in a way similar to the reform of Article 81 and merger control. In particular, we support an effects-based rather than a form-based approach to competition policy. Such an approach focuses on the presence of anti-competitive effects that harm consumers, and is based on the examination of each specific case, based on sound economics and grounded on facts.Competition Policy; Abuse of Market Power; Article 82

An Economic Approach to Article 82

This report argues in favour of an economics-based approach to Article 82, in a way similar to the reform of Article 81 and merger control. In particular, we support an effects-based rather than a form-based approach to competition policy. Such an approach focuses on the presence of anti-competitive effects that harm consumers, and is based on the examination of each specific case, based on sound economics and grounded on facts.competition policy; abuse of market power

The determinants of retailer power within retailer manufacturer relationships evidence from the Irish food manufacturing industry

This research investigates the determinants of retailer power within retailer-manufacturer relationships by specifying and testing three models of retailer power. It is based on a sample of 55 Irish food manufacturers and their experiences of relationships with Irish and British retailers. The study adopts the view that the existing body of research into relationships with retailers is fragmented, and that a more complete understanding of these power relations may be obtained by simultaneously focusing on three sets of factors. The factors are industry specific, firm and product specific, and relationship specific. Much of the existing empirical work investigating power relations implicitly assumes power to be unidimensional through the measures employed. Consequently, the current study investigates retailer power, measured as a unidimensional construct. However, the work proceeds to explicitly acknowledge that power is multidimensional by examining retailers' power over manufacturers' product related and margin related activities. In examining these two dimensions of power, findings ofa more strategic nature are obtained. The analysis draws on the importance French and Raven (1959) attributed to observability as a determinant of power. While neglected throughout the power literature, observability, by introducing monitoring activities, provides a bridge with the transaction cost literature. In this way, specific investments, and the role of retailers' branding strategies, are incorporated into our study of power. The relationship between retailers' monitoring activities and power is specified. Proceeding from monitoring activities, the analysis sheds light on the determinants of inter-firm integration between retailers and food manufacturers. The role of specific investments, symmetric dependency, brand portfolio and retail influence on price are highlighted. The analysis of retailers' product related power supports the role of retail concentration, product shelf-life, manufacturer specific investments and retailers' product monitoring activities. Examining retail margin related power points to the importance of retail concentration, own brand penetration, the importance of economies of scale in manufacturing, product shelf life and manufacturer specific investments. Finally, retail power, measured as a unidimensional construct, is found to be related to own brand market penetration, the importance of economies of scale in manufacturing, manufacturer specific investments and retailers' monitoring activities

Outlining a future of supply chain management-coordinated supply networks

Thesis (S.M.)--Massachusetts Institute of Technology, Dept. of Civil and Environmental Engineering, 2001.Includes bibliographical references (p. 149-157).This thesis explores the use of different approaches and structures to facilitate coordinating a set of strategic business partners across multiple tiers of a single supply chain - defined as the supply network. The study is based on a deductive model of three dimensions of coordination, corresponding to the information, material, and financial dependencies between organizations in a supply network. This segmentation allows separate exploration of coordination structures at the level of information systems, logistics and operations, and financial allocation across organizations within the supply network. The research methodology entailed the use of the Delphi technique, soliciting input via in-depth personal interviews from academic, industry, and consulting experts in supply chain management. This method is selected because of few current examples in industry, lack of hard data and absence of structured frameworks in the field. For each of the coordination dimensions, the structures and mechanisms to efficiently coordinate a supply network were identified, described, and categorized. The result is a structured spectrum of coordinating approaches that illustrates the managing of dependencies within the supply network. Trends and consensus in the responses are identified from the data to provide insight into future developments in the field. Illustrative examples of such coordination structures are discussed to demonstrate the inner working of coordinating mechanisms, and to identify the key issues, requirements and obstacles in achieving coordination across multiple tiers.by Richard M. Hoppe.S.M

Interplay between network configurations and network governance mechanisms in supply networks a systematic literature review

Purpose: This work systematically reviews the extant academic management literature on supply networks. It specifically examines how network configurations and network governance mechanisms influence each other in supply networks. Design: 125 analytical and empirical studies were identified using an evidence-based approach to review the literature mainly published between 1985 and 2012. Synthesis: Drawing on a multi-disciplinary theoretical foundation, this work develops an integrative framework to identify three distinct yet interdependent themes that characterize the study of supply networks: a) Network Configurations (structures and relationships); b) Network Governance Mechanisms (formal and informal); and c) The Interplay between Network Configurations and Network Governance Mechanisms. Findings: Network configurations and network governance mechanisms mutually influence each other and cannot be considered in isolation. Formal and informal governance mechanisms provide better control when used as complements rather than as substitutes. The choice of governance mechanism depends on the nature of exchange; role of management; desired level of control; level of flexibility in formal contracts; and complementary role of formal and informal governance mechanism. Research implications: This nascent field has thematic and methodological research opportunities for academics. Comparative network analysis using longitudinal case studies offers a rich area for further study. Practical Implications: The complexity surrounding the conflicting roles of managers at the organisation and network levels poses a significant challenge during the development and implementation stage of strategic network policies. Originality/value: This review reveals that formal and informal governance mechanisms provide better control when used as complements rather than as substitutes

Resale price maintenance and the limits of Article 101 TFEU: reconsidering the application of EU competition law to vertical price restraints

The public policy towards minimum resale price maintenance (‘RPM’), or vertical price fixing, namely the practice whereby a manufacturer stipulates a retail price floor below which its products are not to be resold, has traditionally been one of the most contentious antitrust issues on both sides of the Atlantic. Economic theory suggests that RPM is capable of producing ambivalent welfare consequences, thus obscuring the intellectual debate as to the optimal antitrust response to the practice. This normative uncertainty is best reflected in the divergent approach taken to RPM under the relevant laws of the United States and the European Union, arguably the world’s two most mature antitrust jurisdictions. In 2007, in its seminal Leegin judgment, the United States Supreme Court abolished the century-old per se ban on vertical price fixing. At the same time, under the European Commission’s recent Guidelines on Vertical Restraints price floors remain subject to a quasi-conclusive presumption of illegality. The purpose of this thesis is to examine whether a more consistent approach through the relaxation of the European Commission’s blanket prohibition on price floors would be feasible and, in effect, desirable. Based on insights from new institutional economics, it will be argued that RPM may on certain occasions be a substitute – however imperfect – for vertical integration, where a merger would be prohibitively costly for the parties, in which case the hierarchical form of organisation will have to be replaced by a hybrid governance structure. Under certain circumstances, a fixed retail profit margin may enhance the self-enforcing range of long-term partnerships governed by relational norms, as well as the manufacturer’s control over distribution by reducing substantially the transaction costs associated with monitoring dealer performance. At the same time, however, the analysis will take into account the various objections to the practice, most notably the horizontal collusion theory, in order to argue that the approach to RPM should in principle be cautious. The discussion will culminate in the proposal for a new, workable analytical framework for the substantive assessment of vertical price fixing under EU competition law, which will be based on a – genuinely – rebuttable presumption of anti-competitive object under Article 101(1) of the Treaty on the Functioning of the European Union

Can Upward Brand Extensions be an Opportunity for Marketing Managers During the Covid-19 Pandemic and Beyond?

Early COVID-19 research has guided current managerial practice by introducing more products across different product categories as consumers tried to avoid perceived health risks from food shortages, i.e. horizontal brand extensions. For example, Leon, a fast-food restaurant in the UK, introduced a new range of ready meal products. However, when the food supply stabilised, availability may no longer be a concern for consumers. Instead, job losses could be a driver of higher perceived financial risks. Meanwhile, it remains unknown whether the perceived health or financial risks play a more significant role on consumers’ consumptions. Our preliminary survey shows perceived health risks outperform perceived financial risks to positively influence purchase intention during COVID-19. We suggest such a result indicates an opportunity for marketers to consider introducing premium priced products, i.e. upward brand extensions. The risk-as�feelings and signalling theories were used to explain consumer choice under risk may adopt affective heuristic processing, using minimal cognitive efforts to evaluate products. Based on this, consumers are likely to be affected by the salient high-quality and reliable product cue of upward extension signalled by its premium price level, which may attract consumers to purchase when they have high perceived health risks associated with COVID-19. Addressing this, a series of experimental studies confirm that upward brand extensions (versus normal new product introductions) can positively moderate the positive effect between perceived health risks associated with COVID-19 and purchase intention. Such an effect can be mediated by affective heuristic information processing. The results contribute to emergent COVID-19 literature and managerial practice during the pandemic but could also inform post-pandemic thinking around vertical brand extensions