Monopoly by Contract: The Practice of Franchised Fee and Royalty Rate
Pages 7-14
Maria Hamideh Ramjerdi

DOI: http://dx.doi.org/10.6000/1929-7092.2014.03.02

Published: 05 February 2014

Abstract: This paper uses a theoretical framework and a by use of a franchising model will examine the practice of charging a franchise fee for the use of the trademark and will show how this practice by controlling the number of franchised operations enables franchisor to extract monopoly profit. Paper will further examine the conditions which the joint practice of franchise fee and royalty rate allows extraction of monopoly rent.