How to deal with resale price maintenance: What can we learn from empirical results?

The US Supreme Court’s overruling of the pre-existing per se illegality of resale price maintenance and the recommendation of a rule of reason approach in the Leegin decision (Leegin Creative Leather Products, Inc. vs. PSKS, Inc., 2007), raise the question whether other jurisdictions should follow this approach and what future assessments of resale price maintenance cases should look like. Policy decisions have to rely on the importance of various theories concerning welfare effects of resale price maintenance practices, which must be supported by empirical studies. The paper focuses on empirically confirmed theoretical arguments for the analysis and discussion of existing assessment proposals. Furthermore, the paper derives a new recommended assessment procedure for resale price maintenance from a special point of view by combining empirical results with the decision-theoretic approach of optimal sequential investigation rules. Copyright Springer Science+Business Media, LLC 2014