On returns policies with exogenous price. (English) Zbl 1159.90301

Summary: We contribute to current research on single-period returns policies by making a clear distinction between models in which transfer price is exogenous and models in which one dominant party unilaterally declares a price. We compare the equilibrium contracts that result from these two approaches and derive conditions for the equilibrium returns policy to be Pareto-efficient when transfer price is exogenous. Our main result is distribution free, but we make some interesting observations on channel performance when demand is uniformly distributed.


90B05 Inventory, storage, reservoirs
91B38 Production theory, theory of the firm
90B30 Production models
Full Text: DOI


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