Overbuying, Demand Withholding, and Single Sourcing Under Decreasing Returns

Christophe Bernard & Sébastien Mitraille

The Journal of Industrial Economics2026https://doi.org/10.1111/joie.70021article
AJG 3ABDC A*
Weight
0.50

Abstract

Consider suppliers whose comparative advantages, which are unknown to a buyer, depend on the quantity procured. The distortions of the buyer purchase policy differs depending on the market characteristics. In a large market, either it overbuys to suppliers with steep marginal costs, who are better at producing a small volume; or it withholds the demand it addresses to suppliers with flatter marginal costs, who are better at producing a large volume. The latter policy is implemented through a concave tariff offered to the less capacity constrained suppliers. In a small market, demand withholding prevails and some suppliers can be excluded.

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https://doi.org/https://doi.org/10.1111/joie.70021

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@article{christophe2026,
  title        = {{Overbuying, Demand Withholding, and Single Sourcing Under Decreasing Returns}},
  author       = {Christophe Bernard & Sébastien Mitraille},
  journal      = {The Journal of Industrial Economics},
  year         = {2026},
  doi          = {https://doi.org/https://doi.org/10.1111/joie.70021},
}

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Overbuying, Demand Withholding, and Single Sourcing Under Decreasing Returns

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0.50

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F · citation impact0.50 × 0.4 = 0.20
M · momentum0.50 × 0.15 = 0.07
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R · text relevance †0.50 × 0.4 = 0.20

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