A Brief Review and Assessment of the Leegin Decision: Who Wins and Who Loses When Manufacturers are Free to Set Retail Prices?
For decades, it has been a per se violation of U.S. antitrust law for manufacturers or distributors to specify retail selling prices. In the spirit of atomistic, unrestrained competition, retailers were free to set prices without undue interference from upstream channel participants. Attempts by manufacturers or other channel participants to restrict retail price setting initiatives were viewed by regulators as an unwarranted and illegal interference with the market mechanism. Restrictions on price setting initiatives would, it was argued, lessen competition and ultimately raise prices above competitive levels to the detriment of consumers. Recently, under the leadership of newly appointed Chief Justice Roberts, a more “business friendly” Supreme Court has reversed this policy; vertical price fixing is no longer a per se violation of U.S. antitrust law. By a five‐to‐four margin, the Court held in Leegin Creative Leather Products that manufacturers could, under certain circumstances, establish binding retail selling prices. Henceforth, retail price setting restrictions will be subject to a rule of reason evaluation whereby price restrictions will be assessed on a case‐by‐case basis. Proponents of the now‐legal restrictions argue that this will ensure that merchandise sold through retail outlets will receive needed support, free riding will be reduced or eliminated, and new brand introduction will be facilitated. Critics argue that the Court's decision marks a return to the days of fair trading; marginal firms will be protected, so‐called “inframarginal consumers” will be forced to pay for services they do not want or need, and prices for many branded products will rise, all to the detriment of consumer welfare.
From “Mom and Pop” to Wal-Mart: The Impact of the Consumer Goods Pricing Act of 1975 on the Retail Sector in the United States
A leisurely drive through the suburban shopping districts of virtually any American city reveals the successful inroads that large mass merchandisers have made into the retail sector in the United States. At the same time, the once-thriving downtown shopping areas of many of these same cities are now rife with boarded-up retail storefronts. Unfortunately, the rise of the corporate retail superstores has come at least in part at the expense of traditional, local, "mom-and-pop" dealers. While shoppers seem to uniformly appreciate the often lower retail prices available at the mass merchandisers, many also rue the loss of personalized customer service previously provided by friendly, local dealers. In this paper, I examine in detail these retail changes in the United States. Using time series data covering the last 40 years, I first paint an empirical picture of the retail sector, providing numerical evidence of the migration from smaller dealers to fewer, larger retail establishments. With this movement toward mass merchandising, there has indeed been a reduction in the level of point-of-sale information services offered to customers on the retail shop floor. Put simply, the empirical evidence is consistent with the casual, anecdotal story told above. But what lies behind this transformation of the retail sector in the United States? I posit that an important piece of federal legislation, the Consumer Goods Pricing Act of 1975,1 which effectively outlawed the manufacturer practice of resale price maintenance (RPM), played a key role in the demise of small, service-oriented retail
Influence of pressure and fluidization velocity on the hydrodynamics of a fluidized bed containing horizontal tubes
Abstract An experimental investigation of the influence of horizontal tubes on the bubble behaviour and through-flow velocity of gas inside bubbles was carried out and the influence of pressure and fluidization velocity was studied. The visible bubble flow rate and the gas velocity through the bubbles were measured simultaneously in a pressurized fluidized bed, using capacitance and Pitot-static pressures probes respectively. Silica sand with a mean particle diameter of 0.7 mm was fluidized at pressures between 01. and 1.6 MPa, in a bed of 0.2 × 0.3 m cross-section. Six different horizontal tube configurations were used and comparisons were made with results obtained in the same bed operated without tubes. The results from the bed with tubes show that the influence of pressure and fluidization velocity is basically the same as in the bed without tubes; an increase in pressure and fluidization velocity increases the bubble activity. At low excess gas velocities, the influence of immersed tubes on the bubble behaviour is less pronounced than at high excess gas velocities. Measurements and visual observations show that a small tube pitch gives a more uniform distribution of the visible bubble flow over the bed cross-section. At a combination of high pressure, high excess gas velocity and a large tube pitch, a preferred bubble path was observed in the centre of the bed cross-section. The pressure probe measurements show that the through-flow velocity of gas inside the bubbles is in most cases higher when tubes are present in the bed. The through-flow velocity consistently decreases with increasing pressure in the bed without tubes. The tendency is largely the same at a low excess gas velocity when tubes are present, but at a high excess gas velocity the through-flow velocity first decreases and then increases as the pressure is increased.