Optimal franchise contracts with private cost information

Autor(en): Hempelmann, B
Stichwörter: Business & Economics; COORDINATION; Economics; franchising; MORAL HAZARD; private information; revelation principle; two-sided incentives
Erscheinungsdatum: 2006
Herausgeber: ELSEVIER SCIENCE BV
Journal: INTERNATIONAL JOURNAL OF INDUSTRIAL ORGANIZATION
Volumen: 24
Ausgabe: 2
Startseite: 449
Seitenende: 465
Zusammenfassung: 
This paper considers franchise arrangements in the case where the franchisee has private information about the marginal cost of sale. It is shown that the optimal contract in general leads to different margins for the parties than with common cost information. However, in special cases the same margins than with common cost information are optimal. (c) 2005 Elsevier B.V. All rights reserved.
ISSN: 01677187
DOI: 10.1016/j.ijindorg.2005.07.008

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