Welfare effects of parallel trade
Opponents to parallel trade claim that it is highly inefficient and that savings to the consumers are only a fraction of the profits to the middlemen. Advocates oppose that savings to the consumers are high and profit margins of parallel traders low. This chapter looks at evidence on consumer gains and parallel distribution mark ups from the past decade. It shows how these figures have evolved over time and draws conclusions on the future development of the ratio between parallel distribution mark-ups and consumer gains.
KeywordsDestination Country Origin Country International Price Parallel Importer Parallel Trader
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