Why Royalties? Evidence from French Distribution Networks

Fadairo, Muriel

doi:10.2139/ssrn.1749506

Abstract

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Why Royalties? Evidence from French Distribution Networks

Muriel Fadairo

University of Lyon 2 - Groupe d'Analyse et de Théorie Economique (GATE)

January 31, 2010

University of Lyon 2 Groupe d'Analyse et de Theorie Economique (GATE) Working Paper No. 1102

Abstract:
This empirical note deals with the contractual design of relationships in distribution networks. In the framework of agency theory, I study the royalty rate as an incentive device for the upstream firm in maintaining brand-name value, using recent French data to estimate probit models. The results are consistent with the analytical framework.

Number of Pages in PDF File: 22

Keywords: Vertical Relationships, Distribution Networks, Contract Design, Two-Sided Moral Hazard

JEL Classification: C12, L14

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Date posted: January 29, 2011 ; Last revised: February 1, 2011

Suggested Citation

Fadairo, Muriel, Why Royalties? Evidence from French Distribution Networks (January 31, 2010). University of Lyon 2 Groupe d'Analyse et de Theorie Economique (GATE) Working Paper No. 1102. Available at SSRN: http://ssrn.com/abstract=1749506 or http://dx.doi.org/10.2139/ssrn.1749506

Contact Information

Muriel Fadairo (Contact Author)

University of Lyon 2 - Groupe d'Analyse et de Théorie Economique (GATE) ( email )

93, chemin des Mouilles
Ecully, 69130
France