Quantity Discount,Retailer Cost Information Identification And Contract Design

With the development of e-commerce,a number of products have begun to use some different methods to assist distribution.For example,in the micro-business sector,most products are keen to utilize volume discounts,and manufacturers are licensed for cross-border behavior between retailers.The quantity discount,as one of the vertical restraint methods,on the one hand has the negative effects of undermining the market order,and damaging the legitimate rights and interests of market operators;on the other hand,on the other hand,it can improve economic efficiency and promote technological progress.Observing the evolution of the attitude of foreign judicial departments on the quantity discount behavior,we can find that the anti-monopoly law enforcement department has undergone a strict and prudent change in the attitude of manufacturers to implement quantitative discounts.However,although there are legal restrictions on the quantity discount in China,the actual law enforcement attitude is not clear.For the welfare analysis of the quantity discount,it is necessary to study the motivation and background.Only by finding the motivation from the source and distinguishing the background conditions can the performance of the quantity discount be correctly evaluated.Most of the related researches are based on the assumption that cost information is symmetrical,ignoring the importance of cost information,and paying less attention to retailers' string behavior.Under the background of retailer's cost information asymmetry and feasible goods,the current theory can't fully explain the effects and problems of quantity discount.This paper attempts to analyze the effects and problems of quantity discounts under the conditions of retailer's cost information asymmetry and feasible goods,and explores feasible incentive-compatible contracts in this context,which is intended to clarify quantity discounts and service incentives.The asymmetry of cost information and the relationship between retailers and sellers help us understand the role of quantity discounts more rationally as well as the behavior of manufacturers.In order to make the theoretical model more convincing,this paper reviews relevant theories and summarizes and combs related research.Through literature review,it is found that the quantity discount is beneficial to motivate retailers to provide services if retailer's cost information is identifiable.It is an effective method for manufacturers to get more profits.However,if retailer's cost information is asymmetrical and the goods are feasible,the current theory can't fully illustrate the effect and problems of the quantity discount,what's more the relevant research is less.On the basis of reviewing the previous research,this paper introduces the retailer's cost information asymmetry and the serial goods into the analysis process,discussing the effects and problems of the quantity discount,and further studies the feasible incentive compatibility contracts.The preliminary conclusions of this paper are as follows: the quantity discount is beneficial to encourage the retailer to provide services and increase the profit of the manufacturer if retailer's cost information can be identified;if the retailer's cost information is unrecognizable,the retailer will lead to the quantity discount invalid.At this time,the manufacturer can identify the retailer's cost information through the fixed fee and the quantity limit,so as to urge the retailer to provide the service and achieve the Pareto optimal result.In addition,under the framework of this paper,if the difference in consumer purchasing power is introduced,manufacturers still need to encourage compatible contracts to guide retailers to meet more demands,and manufacturers and retailers can achieve win-win results.Comparing and analyzing the social welfare result of quantity discount in the background of retail service's cost information symmetry and asymmetry,we find that the quantity discount is indeed an effective measure when information is symmetrical.Therefore,the anti-monopoly law enforcement department this behavior should not be killed with a stick,but should cope with care.When the retailer's information costs are asymmetric,the retailer's differences make it possible to collude in each other and reduce the service.Therefore,the appropriate incentive mechanism contract is indispensable.When the law enforcement department decides on the disputes of the manufacturer,it should fully consider the background of the implementation of the behavior,so as to truly promote the healthy development of the market.