scholarly journals The Strategic Value of Quantity Forcing Contracts

2010 ◽  
Vol 2 (1) ◽  
pp. 204-229 ◽  
Author(s):  
David Martimort ◽  
Salvatore Piccolo
Keyword(s):  
Moral Hazard ◽  
Adverse Selection ◽  
Retail Price ◽  
Strategic Value ◽  
Contractual Incompleteness ◽  
Retail Prices ◽  
Downstream Competition ◽  
Price Maintenance ◽  
Shed Light

We explore the strategic value of quantity forcing contracts in a manufacturer-retailer environment under both adverse selection and moral hazard. Manufacturers dealing with (exclusive) competing retailers may prefer to leave contracts silent on retail prices, whenever other aspects of the retailers' activity remain nonverifiable. Two effects are at play when moving from retail price maintenance to quantity forcing. First, restricting screening possibilities may increase retailers' rent. Second, such a restriction affects downstream competition. This latter effect may justify using quantity forcing contracts and, more generally, shed light on a novel source of contractual incompleteness. (JEL D82, D86, L14)

scholarly journals Penerapan Algoritma K-Means Clustering untuk Pengelompokan Harga Eceran Beras di Pasar Tradisional Berdasarkan Wilayah Kota

2019 ◽  
Vol 1 ◽  
pp. 927
Author(s):  
Theresia Siburian ◽  
M. Safii ◽  
Iin Parlina
Keyword(s):  
Clustering Algorithm ◽  
Population Level ◽  
Retail Price ◽  
High Population ◽  
Traditional Markets ◽  
Strategic Value ◽  
Retail Prices ◽  
The Government ◽  
Almost All ◽  
Food Commodity

Rice is the main food commodity of the Indonesian people, almost all residents in this country consume rice every day. This causes rice commodities to have a very strategic value, apart from being in control of the lives of many people, it can also be used as a parameter of the country's economic and social stability. This study discusses the application of K-Means Clustering Algorithm for Grouping Retail Prices of Rice in Traditional Markets. The source of this research data is collected based on documents describing the retail price group of rice produced by the National Statistics Agency. The data used in this study are data from 2011-2016 consisting of 33 cities. Data is processed by clustering in 3 clusters, namely high population level clusters, medium and low population level clusters. Centroid data for high population level clusters 10,776, Centroid data for moderate population level clusters 9,436 and Centroid data for low population clusters 8,590. To obtain an assessment based on the grouping of the average retail price of rice in traditional markets in 33 cities with high clusters (C1) of 11 cities namely Padang, Pekanbaru, Tanjung Pinang, Bandar Lampung, Jakarta, Pontianak, Palangkaraya, Banjarmasin, Ternate, Jayapura and Manokwari for medium cluster (C2) as many as 11 cities and for low cluster (C3) as many as 11 cities. From the results of this study can be used as input for the government, especially in cities, so that cities that are included in the high cluster can normalize the retail price of rice in each city area.

scholarly journals Dual moral hazard and adverse selection in South African agribusiness: it takes two to tango

2018 ◽  
Vol 21 (3) ◽  
pp. 391-406 ◽  
Author(s):  
Thulasizwe Mkhabela
Keyword(s):  
Asymmetric Information ◽  
Moral Hazard ◽  
South African ◽  
Adverse Selection ◽  
Joint Venture ◽  
Quality Measurement ◽  
Salient Feature ◽  
Retail Price ◽  
Selection Model

The paper employs a dual moral hazard and adverse selection model to analyse partnerships in agribusiness under joint venture contracts with asymmetric information and imperfect quality measurement by the agent and principal both of which contribute to the final quality of the product in terms of production effort and marketing (offtake) effort, respectively. A salient feature of this paper is the analysis of the ramifications of joint venture contract for quantity and quality, which is often deficient in most previous analyses of moral hazard. The research found that contracts that have rewards based on the quantity produced weakened the agent’s incentive to make effort in ensuring quality. This finding could explain why most contracts in agriculture for products with differentiated markets rarely use retail-price conditioned contracts.

On the (Lack of) Stability of Communes

2011 ◽  
pp. 168-190 ◽  
Author(s):  
Ran Abramitzky
Keyword(s):  
North America ◽  
Moral Hazard ◽  
Adverse Selection ◽  
Brain Drain ◽  
Economic Perspective ◽  
Economic Framework ◽  
Sociological Literature ◽  
High Degree ◽  
Shed Light

This article uses an economic perspective to shed light on the conditions under which communes that strive for equality and cooperation are stable, how they persist, and why they often collapse. It presents a view of communes as communities striving for internal equality while mitigating the inherent problems associated with a high degree of equality/redistribution, namely, the tendency of more productive members to leave (brain drain), the tendency to shirk (moral hazard), and the tendency of less-productive individuals to join (adverse selection). The economic framework also explains many of the characteristics of communes discussed in historical and sociological literature. The article illustrates how ideology and religion play important roles in alleviating brain drain, adverse selection, and moral hazard by focusing on communes in North America since the mid-1700s and the Israeli kibbutzim, mainly because these are better documented than communes in earlier periods.

AGENCY PROBLEM DALAM PENERAPAN PEMBIAYAAN AKAD MUDHARABAH PADA PERBANKAN SYARIAH

ALQALAM ◽  
2016 ◽  
Vol 33 (1) ◽  
pp. 46
Author(s):  
Aswadi Lubis
Keyword(s):  
High Risk ◽  
Asymmetric Information ◽  
Human Resources ◽  
Moral Hazard ◽  
Adverse Selection ◽  
Agency Problem ◽  
Agency Problems ◽  
Islamic Banking ◽  
The Public

The purpose of writing this article is to describe the agency problems that arise in the application of the financing with mudharabah on Islamic banking. In this article the author describes the use of the theory of financing, asymetri information, agency problems inside of financing. The conclusion of this article is that the financing is asymmetric information problems will arise, both adverse selection and moral hazard. The high risk of prospective managers (mudharib) for their moral hazard and lack of readiness of human resources in Islamic banking is among the factors that make the composition of the distribution of funds to the public more in the form of financing. The limitations that can be done to optimize this financing is among other things; owners of capital supervision (monitoring) and the customers themselves place restrictions on its actions (bonding).

scholarly journals Strategic Analysis of the Pricing Mechanisms in an Online Book Supply Chain in the Presence of Reference Price Effects

2021 ◽  
Vol 16 (5) ◽  
pp. 1492-1516
Author(s):  
Wenhua Hou ◽  
Yuwen Zeng
Keyword(s):  
Supply Chain ◽  
Discount Rate ◽  
Reference Price ◽  
Stackelberg Game ◽  
Lower Boundary ◽  
Retail Price ◽  
Reference Points ◽  
Price Effects ◽  
Retail Prices ◽  
Online Book

(1) Background: A binding recommended retail price has been used in several markets in a variety of forms, and the book market is a typical example. Publishers sell books to online retailers at a unit wholesale discount computed on the cover price. Retailers are then allowed to set the retail price. Therefore, if consumers regard the cover prices as reference points, then they may be more likely to purchase books if retail prices are lower than the cover prices. (2) Methods: We develop a Stackelberg game model for a book supply chain to investigates how reference price effects affect retailers and publisher’s pricing strategies. (3) Results: The results show that retailers will sell printed books at a discount only when the publisher’s wholesale discount rate is not high. Further, as the intensity of the reference price effects increases, (a) the lower boundary of the wholesale discount rate rises, (b) publishers’ profits increase and (c) retailers’ profits increase relative to the level of consumers’ e-books acceptance. (4) Conclusions: This result is related to the fact that the online retailer, such as Amazon and JD.com, like to invoke reference price effects in consumers’ minds by highlighting the printed book’s discount rate.

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