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HOW LOYALTY DISCOUNTS CAN PERVERSELY DISCOURAGE DISCOUNTING

Einer Elhauge.

in Journal of Competition Law & Economics

June 2009; p ublished online March 2009 .

Journal Article. Subjects: Game Theory and Bargaining Theory; Antitrust Issues and Policies; Market Structure, Firm Strategy, and Market Performance. 16851 words.

Loyalty discounts are agreements to sell at a lower price to buyers who buy all or most of their purchases from the seller. This article proves that loyalty discounts can create...