Study On The Social Welfare Effect Of Agency Contract In E-commerce

Agency contract is a form of contract for the principal to hire agents to provide them with certain services.It is widely used in various situations involving cooperation between different market entities,such as manufacturers and retailers,regulators and regulated objects,as well as shareholders and management of a company.In the theory of industrial organization,sales contracts of retailers in upstream and downstream industries are divided into wholesale contracts and agency contracts(the research object of this paper)according to the ownership and property rights of products of manufacturers.Accordingly,manufacturers and retailers sign wholesale contracts and agency contracts respectively in these two modes.Under the wholesale contract,the retailer buys the goods it sells from the manufacturer at the wholesale price and sells them at the retail price,making profit by virtue of the difference between the retail price and the wholesale price,such as the traditional supermarket department store.Under the agency contract,the retailer matches the buyer with the seller in the platform mode and charges the seller a certain amount of agency fees according to the agreed agency rate(commission rate),such as the domestic e-commerce platforms Taobao and JINGdong.The emergence and development of e-commerce has had a significant impact on the economies of all countries in the world.Digital products such as e-books and games,as well as digital products and clothing,and a large number of industries have begun to transform online sales and then adopt agency contracts.Online retailers use Internet tools to provide services for manufacturers,including online display,publicity,matchmaking,etc.Upstream manufacturers(manufacturers)display and sell products on the platform built by online retailers,and pay commissions to online retailers.With the rapid development of Internet and other information technologies worldwide,the emergence of new e-commerce activities and transactions,and the development of countries around the world.At the same time,online retailers rise rapidly and develop vigorously.Based on their huge user scale,online retailers have gained a strong market power.Agency contract and other new models and competitive strategies are widely used.In the sales activities of a large number of products,the upstream manufacturers directly set the retail price.The above factors have led to the increasingly prominent anti-monopoly problems of online retailers implementing agency contracts,and attracted the attention of academic circles and anti-monopoly law enforcement departments.How to recognize enterprise behavior in e-commerce environment more comprehensively,create the electronic commerce environment of fair competition environment,relying on the online e-commerce means to implement the effective lead and guide to the real economy,improve the whole social welfare,and promote the development of related fields in our country and the prosperity of the economy in the electricity,is an important problem facing the government and academia.The above questions are still being explored.Based on this,this paper takes the agency contract under the e-commerce environment as the research object,which can further enrich the vertical relationship of firm competition theory,and serve China's anti-monopoly law enforcement practice,and has a strong theoretical research value and practical guidance significance.This paper focuses on the social welfare effects of agency contracts,considers spillover effects and indirect network externalities between online and offline channels,introduces upstream and downstream competition,and systematically analyzes the game balance,firm behavior and social welfare issues in agency contracts.This paper will combine the case with theoretical analysis,closely around the "Apple Monopoly case" of different stages and events for case analysis.First to the apple case trial and judgment as the background,extracting channels between the spillover effect and indirect network externalities as the research variables,two core elements in agency contract social welfare as the breakthrough point,promote efficiency of agency contract theory,to clarify the mechanism of the concrete parameters,finally combining with the case and the judgment fact,This paper analyzes the effects of spillover effect and indirect network externality,and re-examines the anti-competitive effect of agency contract,the judgments and regulatory measures of anti-monopoly law enforcement agencies.Second to apple in the apple into the e-book market during the contract choice as the background,in view of the upstream downstream of monopoly and competition market structure under the welfare effect of agency contract issues,to explore the downstream competition to select vendor contracts,by calculating the degree of product difference parameters to simulate different competitive environment,Then it analyzes the profit and contract choice preference of the manufacturer under the corresponding circumstances and explores the internal logic of apple's contract choice during its entry into the e-book market in the Apple case.Third,with apple in the amazon and publishing enterprises conflict events as the background,research of upstream competition,downstream monopoly market structure under the agency contract manufacturer problem behavior and social welfare effect,analyzed the link between the upstream competition and market conduct,by calculating the degree of product difference parameters to simulate different competitive environment,Then it analyzes the profit and contract choice preference of the manufacturer under the corresponding circumstances,explores the cause and mechanism of the conflict between Amazon and publishing enterprises in the Apple case,and tries to give a possible solution from the model calculation and simulation results.Fourth,with apple case transverse relationship between publishing enterprises and arrangement as the background,built a bilateral monopoly competition market structure under the agency contract model,calculated the upstream collusion both makers and conspiracy under the two circumstances of manufacturer's profits,collusion motivation shelter-forest profiling agent contract manufacturers,in case of price behavior and transverse conspiracy to commit to review together.The research content of this paper is divided into seven chapters,chapter 1 is the introduction;Chapter 2 reviews and reviews the existing literature.Chapter 3 analyzes the social welfare effects of agency contracts under the bilateral oligopoly market structure based on the trial process and judgment of The Apple case.Focusing on the channel spillover effect and indirect network externality,it reveals the mechanism of improving the efficiency of agency contracts within a specific parameter interval.Chapter 4 discusses the influence of the degree of downstream competition on the contract selection of manufacturers,aiming at the social welfare effect of agency contract under the market structure of upstream monopoly and downstream competition,based on the contract selection of Apple during its entry into the e-book market in the Case of Apple.Chapter 5 analyzes the conflict between Amazon and publishing companies in the Apple case,studies the social welfare effects of agency contracts under the market structure of upstream competition and downstream monopoly,and analyzes the relationship between the degree of upstream competition and the behavior of manufacturers.Chapter 6 focuses on the horizontal relationship and agreement arrangement between publishing enterprises in the Apple case,and analyzes the motivation of collusion between middle and upper companies in agency contracts in view of the social welfare effect of agency contracts under the market structure of bilateral oligarchic competition.Chapter 7 is the conclusion of this paper,policy suggestions and enterprise management enlightenment.Through theoretical analysis and numerical simulation of agency contract,it provides more specific theoretical reference and basis for anti-monopoly legislation and law enforcement,and also provides theoretical basis for decision-making of enterprise operation management in e-commerce environment.Through the above research,the main conclusions are as follows:First,the preferences of manufacturers and policy makers for agency contracts under different market structures are studied.One is when the downstream market competition intensifies,online retailers have greater motivation to use agency contract,now can become leaders in the Stackelberg competition,in turn,better control of the market,and by allowing manufacturers in between rival online retailers set the retail price of a single,alleviate the pressure of the part of the competition among retailers.To some extent,whether online retailers should adopt agency contracts is directly related to the spillover effect between online sales channels and offline traditional sales channels,as well as the market structure and competition degree of upstream and downstream.When the spillover effect from online sales channel to offline traditional sales channel is negative or small,online retailers should choose agency contract,and on the contrary,adopt wholesale contract.Second,this paper studies upstream competition and the preference of manufacturers and policy makers for agency contracts.When the upstream market competition intensifies,online retailers have greater motivation to use wholesale and contract,the retailer's mark-up ability is stronger,and higher profits,at the same time,retailers prefer the agency contract area reduction,increase in the number of regional agency contract manufacturers preference,lead to consumer welfare under the agency contract and the decrease in the total social welfare.In summary,there is pareto efficiency improvement over wholesale contracts,in which manufacturers,consumers and policy makers all prefer agency contracts.Secondly,spillover effects and indirect network externalities are studied on the contract preference of manufacturers and policy makers.First,the relationship between equilibrium solution of agency contract and parameters,the increase of spillover effect and indirect network externality can reduce retail price,increase manufacturer's profit,improve consumer welfare and social welfare.The second is the comparison between agency contract and wholesale contract.When the spillover effect is large and the indirect network externality is small,the price of wholesale contract is lower,which is more suitable for retailers,consumers and policy makers.When the spillover effect is small and the indirect network externality is large,the agency contract is better for retailers,consumers and policy makers.Thirdly,this paper studies the setting of agency fees under different market structures.The results show that the agency cost depends not only on market competition,but also on spillover effect and indirect network externality.When the channel spillover effect increases from negative to positive,the agency cost increases first and then decreases.When the indirect externality increases,the agency cost increases only when the channel spillover effect is positive,and conversely decreases.In addition,different from traditional economic intuition,the results of this model show that agency costs do not always decrease with the fierce downstream competition.When the spillover effect is large,agency costs may increase with the fierce competition among online retailers due to the existence of manufacturers' motivation to stimulate online demand.Fourthly,this paper analyzes the different stages and events of the monopoly case of Apple Inc.Through the analysis of the case,the ANTI-monopoly law enforcement department of the United States directly identified the short-term increase in e-book sales price as the decline of consumer welfare,and attributed it to the agency contract and horizontal collusion.The model analysis results of this paper show that there are certain flaws in the above logic.Agency contracts are more efficient in most cases due to the benefit sharing mechanism.The most reasonable explanation for the short-term price increase in this case should be the decline of indirect network externalities caused by Apple's entry into the e-book reader market.In addition,the analysis results show that upstream manufacturers have no collusion motivation under agency contracts.The reason is that even if the upstream companies conspired to raise prices,because the downstream companies are the leader of Stackelberg price competition,the collusion of the upstream companies will cause the downstream companies to raise agency fees,and thus fail to obtain the profits brought by the reduced competition in the traditional wholesale contract situation.Finally,according to the above research conclusions,this paper puts forward the following policy recommendations: First,on the basis of reasonable principles,we should improve the understanding of agency contract efficiency factors in the context of e-commerce;Second,anti-monopoly law enforcement should be careful to do a good job of market definition,scientific analysis and comparison of price fluctuations;Third,we should encourage the win-win mode of upstream and downstream enterprises to promote sound and long-term development of the industry.At the same time,this paper puts forward the following enterprise management enlightenment: first,when new platform enterprises face the competition between platforms,they should pay attention to their own characteristics,improve the indirect network externalities through traffic realization and other ways,and then realize the rapid development of platform;Second,strong platform enterprises in a monopoly position should "price due to product".High commission is not the same as the optimal commission,and platform commission schemes should be optimized according to product categories.Third,upstream small and medium-sized enterprises should take the initiative to embrace the Internet,renote product differences,improve the conversion rate between channels;Fourth,large and powerful upstream enterprises should make contract models and pricing decisions based on product characteristics.The main contribution of this paper lies in:First,on the basis of previous studies,this paper constructed an economic model of agency contract under the e-commerce environment,and followed the research ideas of "model construction ? equilibrium solution ? theoretical analysis ? numerical simulation? case analysis ? policy suggestions".Stackelberg price competition theory is used to systematically analyze the price,manufacturer's profit,consumer welfare and social welfare of agency contract,and then put forward the influencing factors to improve the efficiency of agency contract.Compared with previous literatures,this paper describes the characteristics of agency contract in e-commerce environment more comprehensively,especially including channel spillover effect and network externality into the model,which is more in line with reality and more explanatory.It includes different market structures and reveals the influence mechanism of upstream and downstream competition on agency contracts.In general,this paper is innovative and forward-looking in the perspective of topic selection.Second,this paper adopts a relatively new endogenous agency cost model for theoretical analysis.On the basis of the existing literature,this paper sets the agency cost as the endogenous variable of the model,discusses the direct effect and indirect effect of the related variables,draws a conclusion different from the existing literature,and makes an in-depth analysis of the rationality of the conclusion and the reasons and mechanism in the conclusion.Rich agency contract pricing research.The above research methods of endogenous agency costs are seldom or not yet applied in the field of longitudinal relationship research.Thirdly,from the perspective of anti-monopoly law enforcement,this paper breaks through the limitation of simple analysis of theoretical model in the previous single operation management,as well as the legal theory research based on a single case,and then obtains different conclusions from the past,which reflects the innovation of the research perspective.Focus international high-profile case "apple" specific case,based on the section of theoretical analysis,list case facts and analyze events in stages as a result,the system to present the whole picture of the apple case,and puts forward different points of view,the case for business management,and provide reference for antitrust enforcement.Fourthly,it challenges the theory that agency contract promotes collusion and produces anti-competitive effect.According to the traditional collusion theory without considering the endogenous agency cost,the direct pricing of upstream manufacturers will weaken the competition between brands and maintain the stability of the cartel among manufacturers,which is conducive to promoting the collusion.However,after incorporating the intrinsic game of agency costs in reality into the model,the research finds that: Although manufacturers can raise retail prices through collusion,retailers can raise agency costs at this time,especially in the case of large channel spillover effect,agency costs increase substantially,manufacturers' profits decline due to collusion,retailers' profits increase,and consumers' welfare suffers losses due to higher retail prices.Therefore,this paper studies the vendor behavior and welfare effect of agency contract under the e-commerce environment,which enriches the content and level of existing agency contract research from the perspective of theory and case analysis.