A Model on Cooperative Advertising of Trade Promotion
Cao, Zhenzong
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https://hdl.handle.net/2142/84591
Description
Title
A Model on Cooperative Advertising of Trade Promotion
Author(s)
Cao, Zhenzong
Issue Date
1997
Doctoral Committee Chair(s)
Monahan, George E.
Department of Study
Business Administration
Discipline
Business Administration
Degree Granting Institution
University of Illinois at Urbana-Champaign
Degree Name
Ph.D.
Degree Level
Dissertation
Keyword(s)
Mathematics
Language
eng
Abstract
Cooperative advertising is modeled as a two-stage game with perfect information. It is first demonstrated that the equilibrium exists. Then, it is shown that (i) if the manufacturer does not change wholesale price: Schedules (a) and (c) generate the same profits to the manufacturer, under Schedules (a) and (c) the participation rates are set at 100 percent, under Schedule (c) the participation rate is binding always, and there is no dominant strategy among the three schedules; and (ii) if the manufacturer changes wholesale price Schedule (c) is a strictly dominant strategy and Schedule (u) is strictly dominated, under Schedule (a) the participation rates are strictly less than 100 percent, under Schedule (c) the participation rates can be set at 100 percent and the participation rate is always binding and in general, the characterization of the equilibrium under Schedule (c) is open, except in some special cases.
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