1 / 9

Market Allocation in Golf Retail Industry: Impacts and Implications

Explore the anti-competitive behaviors of Golf Galaxy and Golf Canada, competitors in the golf market, engaging in market allocation. Learn about the effects on competition, consumers, and society, leading to monopolization and inefficiency in resource allocation.

dyre
Download Presentation

Market Allocation in Golf Retail Industry: Impacts and Implications

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Econ presentation- Market allocation Mandy Cheng (5) Nonie Cheng (6)

  2. News Summary • Golf Galaxy: operating a chain of U.S.-based golf superstores that offers a wide range of merchandise and related services • Golf Canada: operating a chain of similar stores in Canada

  3. Identify the type of anti-competitive behaviours • Market allocation/market division • Meaning: Under an agreement of market allocation, the competitors in a market form a cartel and agree to divide the market into territories. • Horizontal agreement - an agreement among competitors in the same market to restrict competition • Golf Galaxy and Golf Canada are competitors in the same golf market • Dividing the market into territories:Golf Galaxy - the US Golf Canada – Canada • Restricted competition  market allocation.

  4. Effects of market allocation For the Golf Galaxy & Golf Canada: • More promotionsMonopoly rights sell products in Canada and United States Capture all the benefits from product promotion • Less competition May become monopolists in Canada and United States price searcher  raise price easily &earn monopoly profit

  5. For golf merchandise industry • Less competitive no power in the market • Hard to enter the industry market is being monopolized Entry is restricted

  6. For Consumers: • Unfair market is monopolized Less Choices  More expensive

  7. For Society: • Two companies set a higher price earn the monopoly profit capture some of the consumer surplus MB>MC Underproduction of output Deadweight loss TSS Inefficiency in resource allocation in society

  8. ~~~The End~~~

More Related