Resale price maintenance and manufacturer competition for retail services

We investigate the incentives of manufacturers to use resale price maintenance (RPM) when selling products through common retailers. In our model retailers provide product specific pre-sales services. If the competitive retail margins are low, each manufacturer fixes a minimum price to induce favorable retail services. With symmetric manufacturers, products are equally profitable in equilibrium and no product is favored as without RPM, but retail prices are higher. We show that minimum RPM can create a prisoner’s dilemma for manufacturers without increasing, and possibly even decreasing the overall service quality. This challenges the service argument as an efficiency defense for RPM

Resale Price Maintenance: Hurting Competitors, Consumers and Yourself

Improving retailers' incentives for service is a prominent efficiency defense for resale price maintenance (RPM). We investigate the incentives of symmetric manufacturers to use RPM when selling products through common retailers who provide services such as pre-sale advice. We show that the possibility to use minimum RPM can create a dilemma for manufacturers when retailers influence consumer choice through service. If price competition among retailers is strong, a manufacturer benefits from introducing minimum RPM as it incentivizes retailers to favor the sales of her product. However, other manufacturers follow into RPM. In the symmetric equilibrium, service is unbiased, but retail margins and consumer prices are higher than without RPM. In turn, manufacturers' profits and social welfare are lower. This challenges the service argument as an efficiency defense for RPM

Capacity constrained price competition with transportation costs

We characterize mixed-strategy equilibria in case of capacity constrained price competition, transportation costs and customer-specific pricing. Equilibrium prices weakly increase in the distance between supplier and customer. Despite prices above costs and excess capacities, the firms exclusively their serve home markets. Competition yields volatile market shares and an inefficient allocation of more distant customers to suppliers. Even ex-post subcontracts may restore efficiency only partly

Licensing with Free Entry

The literature on the licensing of an innovation has mainly focused on some speci c contract types. We show within the framework of a fairly general model that removing these contractual limitations will lead to extreme market outcomes. Speci cally, we nd that when the patentee can employ observable contracts that can condition on market entry, it can achieve the monopoly outcome. Furthermore, when the patentee can only use unconditional quantity forcing contracts, it captures the entire market, albeit not at monopoly price, via a single licensee. Our results point out to the signi cance, and perhaps the particularity, of observable, nonrenegotiable contracts

Competition, collusion and spatial sales patterns : theory and evidence

We study competition in markets with significant transport costs and capacity constraints. We compare the cases of price competition and coordination in a theoretical model and find that when firms compete, they more often serve more distant customers that are closer to plants of competitors. By means of a rich micro-level data set of the cement industry in Germany, we provide empirical evidence in support of this result. Controlling for other potentially confounding factors, such as the number of production plants and demand, we find that the transport distances between suppliers and customers were on average significantly lower in cartel years than in non-cartel years

Tambora 1815 as a test case for high impact volcanic eruptions: Earth system effects

The eruption of Tambora (Indonesia) in April 1815 had substantial effects on global climate and led to the ‘Year Without a Summer’ of 1816 in Europe and North America. Although a tragic event—tens of thousands of people lost their lives—the eruption also was an ‘experiment of nature’ from which science has learned until today. The aim of this study is to summarize our current understanding of the Tambora eruption and its effects on climate as expressed in early instrumental observations, climate proxies and geological evidence, climate reconstructions, and model simulations. Progress has been made with respect to our understanding of the eruption process and estimated amount of SO2 injected into the atmosphere, although large uncertainties still exist with respect to altitude and hemispheric distribution of Tambora aerosols. With respect to climate effects, the global and Northern Hemispheric cooling are well constrained by proxies whereas there is no strong signal in Southern Hemisphere proxies. Newly recovered early instrumental information for Western Europe and parts of North America, regions with particularly strong climate effects, allow Tambora's effect on the weather systems to be addressed. Climate models respond to prescribed Tambora-like forcing with a strengthening of the wintertime stratospheric polar vortex, global cooling and a slowdown of the water cycle, weakening of the summer monsoon circulations, a strengthening of the Atlantic Meridional Overturning Circulation, and a decrease of atmospheric CO2. Combining observations, climate proxies, and model simulations for the case of Tambora, a better understanding of climate processes has emerged

Heat in Germany: Health risks and preventive measures

Background: Climate change has already led to a significant temperature increase in Germany. The average temperature in the past decade was approximately 2°C above the pre-industrial level and eight of the ten hottest summers since the beginning of systematic weather records in 1881 were recorded in the last 30 years. Methods: Based on a selective literature search and authors’ evaluations, the article summarises the current state of knowledge on heat and its health impacts for Germany, addresses adaptation measures, and gives an outlook on implementation and research questions. Results: Heat can aggravate pre-existing conditions such as diseases of the cardiovascular system, the respiratory tract, or the kidneys and trigger potentially harmful side effects for numerous medications. A significant increase in mortality is regularly observed during heat events. Previous approaches to mitigate the health impact of high temperatures include, for example, the heat alerts of the German Meteorological Service and recommendations for the preparation of heat-health action plans. Conclusions: Evidence on health impacts of heat and awareness of the need for heat-related health protection have grown in recent years, but there is still a need for further action and research. This is part of a series of articles that constitute the German Status Report on Climate Change and Health 2023

Open-Source Ansatz zur Abschätzung Sozioökonomischer Klimafolgen für Deutschland am Beispiel Extremer Hitze

Vorhersage und ProjektionDie Zunahme von Wetter- und Klimaextremen durch den voranschreitenden Klimawandel ist zunehmend mit gesellschaftlichen Beeinträchtigungen und ökonomischen Kosten verbunden. Eine umfassende Quantifizierung und nutzerspezifische Kommunikation dieser sozioökonomischen Klimafolgen an politische und privatwirtschaftliche Entscheider ist für die Vermeidung möglicher Folgen oder eine adäquate Anpassung unerlässlich. Eine Abschätzung sozioökonomischer Klimafolgen erfordert (i) Daten zur klimatischen Gefährdung, (ii) Informationen zur räumlichen Exposition sozioökonomischer Größen, (iii) Annahmen zur ihrer Sensitivität, als auch (iv) eine Maschinerie, um diese Größen gekoppelt auszuwerten. Hierfür wird in diesem Vortrag die open-source python Plattform CLIMADA [1,2] vorgestellt und zur sozioökonomischen Folgenabschätzung durch Wetter- und Klimaextreme auf Deutschland angewendet. Am Beispiel von extremer Hitze wird demonstriert, wie projizierte klimatische Trends mit unterschiedlichen Szenarien für den demographischen Wandel auf sub-nationaler Skala wechselwirken und so die möglichen Auswirkungen (z.B. durch hitzebedingte Übersterblichkeit [3]) verstärkt werden könnten. Die Anwendung von CLIMADA ist nicht nur auf Klimaprojektionen beschränkt, sondern erlaubt eine räumlich aufgelöste und nahtlose Bereitstellung von sozioökonomischen Risiken und ökonomischen Schäden durch Wetter- und Klimaextreme von der Wettervorhersage bis zum Ende des Jahrhunderts

Coupling of Arctic ozone and stratospheric dynamics and its influence on surface climate : the role of CFC concentrations

Arctic stratospheric ozone has been shown to exert a statistically significant influence on Northern Hemispheric surface climate. This suggests that Arctic ozone is not only passively responding to dynamical variability in the stratosphere, but actively feeds back into the circulation through chemical and radiative processes. However, the extent and causality of the chemistry-dynamics coupling is still unknown. Since many state-of-the-art climate models lack a sufficient representation of ozone-dynamic feedbacks, a quantification of this coupling can be used to improve intra-seasonal weather and long-term climate forecasts. We assess the importance of the ozone-dynamics coupling by performing simulations with and without interactive chemistry in two Chemistry Climate Models. The chemistry-dynamics coupling was examined in two different sets of time-slice simulations: one using pre-industrial, and one using year-2000 boundary conditions. We focus on the impact of sudden stratospheric warmings (SSW) and strong vortex events on stratosphere-troposphere coupling, since these go along with strong ozone anomalies and therefore an intensified ozone feedback. We compare the runs with and without interactive chemistry. For pre-industrial conditions, simulations without interactive ozone show a more intense and longer lasting surface signature of SSWs compared to simulations with interactive chemistry. Conversely, for year-2000 conditions, the opposite effect is found: interactive chemistry amplifies the surface signature of SSWs. Following these results, atmospheric CFC concentrations, which differ greatly in the pre-industrial and year-2000 runs, determine the sign of the ozone-circulation feedback, and thus have a strong impact on chemistry-climate coupling. Implications for modeling of stratosphere-troposphere coupling and future projections are discussed

Stratospheric ozone chemistry feedbacks are not critical for the determination of climate sensitivity in CESM1(WACCM)

The Community Earth System Model‐Whole Atmosphere Community Climate Model (CESM1‐WACCM) is used to assess the importance of including chemistry feedbacks in determining the equilibrium climate sensitivity (ECS). Two 4×CO2 model experiments were conducted: one with interactive chemistry and one with chemical constituents other than CO2 held fixed at their preindustrial values. The ECS determined from these two experiments agrees to within 0.01 K. Similarly, the net feedback parameter agrees to within 0.01 W m−2 K−1. This agreement occurs in spite of large changes in stratospheric ozone found in the simulation with interactive chemistry: a 30% decrease in the tropical lower stratosphere and a 40% increase in the upper stratosphere, broadly consistent with other published estimates. Off‐line radiative transfer calculations show that ozone changes alone account for the difference in radiative forcing. We conclude that at least for determining global climate sensitivity metrics, the exclusion of chemistry feedbacks is not a critical source of error in CESM