Abstract
Resale price maintenance (RPM), a form of vertical price fixing, involves agreements between marketers at different levels in a distribution system to establish the resale price at which sales of a product or service will occur. The Supreme Court’s decision in Leegin v. PSKS altered the legal standards applicable to minimum RPM and has resulted in an increase in the use of RPM by marketers. The lack of contemporary research on RPM and its effects on competition has led to initiatives and calls for research on this marketing practice. In the current paper, the authors synthesize findings from extant multi-channel research relevant to understanding the primary procompetitive justification for RPM– the so-called “free rider” thesis. The findings of this research augment antitrust understanding of RPM in important and novel ways.
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