Money-back guarantees and market experimentation

Article Abstract:

A study of the money back guarantee (MBG) by companies to induce consumers to repeat purchases of experience goods, considers MBG to be optimal only when a monopolist faces an uncertain distribution of buyers. The second period experimentation with MBG allows the monopolist to discriminate between first time and repeat customers, instead of using a price reduction strategy.

Research Findings, Marketing, Company marketing practices, Marketing research, Market research

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Bertrand equilibria with entry: limit results

Article Abstract:

The limiting behavior of Bertrand equilibrium in which firms must supply the whole of the demand coming to them, for two different cases is discussed. The limit equilibrium set is characterized for both cases for a large class of cost functions.

Analysis, Supply and demand, Equilibrium (Economics)

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The hold-up problem in a repeated relationship

Article Abstract:

Hold-up problem in repeated transactions between a seller and a buyer are analyzed. Benefits of vertical integration in enhancing the customer's relations and improving sellers' production are emphasized.

Methods, Vertical integration, Customer relations

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