Speaker: Linfeng Chen, Zhejiang Gongshang University

Time: 2024/12/11, 10:00-13:30 (Beijing Time)

Title: Profit Enhancing Leakage (Showrooming), Platform Deterrence and Beneficial Ban

Venue: 106 Zhonghui Building

Abstract:

Buyers could showroom on the platform which is bad for the platform in the literature. And the platform might apply price parity clauses to deter showrooming. Different countries have different regulations for this clause. In contrast to the literature, we show that showrooming could be good for the platform in general conditions. Without commitment power, the platform would deter showrooming and hurt itself. The ban on price parity clause helps the platform to commit and benefit all players. With commitment power, the platform would optimally choose an interior level of showrooming and it is socially too small. The results hold for the wholesaler model.