Program > Papers by speaker > Bonroy Olivier

Tuesday 13
D8 - Miscellaneous III
Chair: Olivier Bonroy
› 15:15 - 15:40 (25min)
› Room 103 - B. Martinu
Contract contingency in vertically related markets
Emanuele Bacchiega  1@  , Olivier Bonroy  2@  , Emmanuel Petrakis  3@  
1 : Università di Bologna [Bologna]  (UNIBO)  -  Website
Via Zamboni, 33 - 40126 Bologna -  Italy
2 : Laboratoire d'Economie Appliquée de Grenoble  (GAEL)  -  Website
Institut national de la recherche agronomique (INRA) : UMR1215, Université Grenoble Alpes - Grenoble II
UMR GAEL / INRA, Université Grenoble Alpes, 1241 rue des Résidences 38400 - Saint Martin d'Hères -  France
3 : University of Crete  -  Website
University of Crete Gallos University Campus 74100 Rethymnon Crete, Greece -  Greece

We study pre-contractual arrangement (PCA) offers by an upstream monopolist supplier, such as the exclusivity and contingency of contracts to be signed between the supplier and two vertically differentiated downstream firms. PCAs are increasingly considered binding in Courts, creating strategic value for their offering party. Once the PCAs determined, the contractual terms are negotiated between the supplier and the downstream firm(s). The bargaining power distribution during these negotiations mainly drives the monopolist's choices. A powerful supplier selects exclusivity. A weaker supplier offers non-exclusive contracts, making them contingent or not to secure the most favorable outside options in its negotiations.

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