Universität zu Köln

Aghadadashli, Hamid, Dertwinkel-Kalt, Markus and Wey, Christian (2016). The Nash bargaining solution in vertical relations with linear input prices. Econ. Lett., 145. S. 291 - 295. LAUSANNE: ELSEVIER SCIENCE SA. ISSN 1873-7374

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Abstract

We re-examine the Nash bargaining solution when an upstream and N downstream firms bargain over a linear input price with unobservable contracts. We show that the profit sharing rule is given by a simple and instructive formula which depends on the parties' disagreement payoffs, the profit weights in the Nash-product and the elasticity of derived demand. A downstream firm's profit share increases in the equilibrium derived demand elasticity which in turn depends on the final goods' demand elasticity. (C) 2016 Elsevier B.V. All rights reserved.

Item Type:	Journal Article
Creators:	Creators Email ORCID ORCID Put Code Aghadadashli, Hamid UNSPECIFIED UNSPECIFIED UNSPECIFIED Dertwinkel-Kalt, Markus UNSPECIFIED UNSPECIFIED UNSPECIFIED Wey, Christian UNSPECIFIED UNSPECIFIED UNSPECIFIED
URN:	urn:nbn:de:hbz:38-268191
DOI:	10.1016/j.econlet.2016.07.008
Journal or Publication Title:	Econ. Lett.
Volume:	145
Page Range:	S. 291 - 295
Date:	2016
Publisher:	ELSEVIER SCIENCE SA
Place of Publication:	LAUSANNE
ISSN:	1873-7374
Language:	English
Faculty:	Unspecified
Divisions:	Unspecified
Subjects:	no entry
Uncontrolled Keywords:	Keywords Language COUNTERVAILING POWER; EMPIRICAL-EVIDENCE; MEDICAL DEVICES; COMPETITION; CONTRACTS; INDUSTRY; MERGERS Multiple languages Economics Multiple languages
Refereed:	Yes
URI:	http://kups.ub.uni-koeln.de/id/eprint/26819