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The Agency and Wholesale Models in Electronic Content Markets

2012; RELX Group (Netherlands); Linguagem: Inglês

10.2139/ssrn.2126808

1556-5068

Justin P. Johnson,

Merger and Competition Analysis

I investigate strategic interactions and market outcomes in the "agency model" and "wholesale model" of sales.Adopting the agency model initially raises prices, and can (but need not) raise the profits of rival retailers.Nonetheless, consumers prefer the agency model.I relate my results to events in the market for electronic books.