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| Monopoly and Monopolistic Behavior of Trading Platform: Based on the Perspective of Slotting Allowance |
| QIU Yi1,ZHENG Yongjun1 |
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Abstract With the background of the increasing of concentration in China’s circulation industry, a number of big trading platforms implement monopolistic behavior with their monopoly power by means of charging slotting allowance from suppliers. This paper used a price competition model which contains two kinds of trading platform to analyze causes of such phenomenon and effect of industry organization of circulation. This research showed that: there were characteristics of self-reinforcement between monopoly and monopolistic behavior of trading platform. An advantage platform could get a bigger market share and a higher profit by charging slotting allowance from suppliers and making a lower price for consumers, but the cost of making lower price will be paid by its suppliers. Therefore, if without some constraints policy, the increase of a trade platform’s market power would be accompanied by the charging of slotting allowance, so government should consider importing competitive factors to regulate such kind of monopoly behavior.
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Received: 07 March 2013
Published: 15 July 2013
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Corresponding Authors:
QIU Yi
E-mail: qiuyi1981@gmail.com
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