Negotiated Transfer Pricing in a Team-Investment Setting

Martini JT, Haake C-J (2004) Discussion paper / Fakultät für Wirtschaftswissenschaften, Universität Bielefeld, 523.
Bielefeld: Universität Bielefeld.

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Abstract
We consider a team-investment setting, in which transfer prices between two divisions are negotiable. Investments are made independently and simultaneously after the bargaining stage, i.e., with a given transfer price "on the table". Both divisions' investments jointly affect the sales volume of the final product and hence total revenue. The bargaining problem over transfer prices is shaped by equilibrium profits in these investment games. We analyze cost- and revenue-based transfer pricing schemes and their corresponding bargaining problems. Moreover, we discuss how concepts from bargaining theory are used to select a transfer pricing scheme and the transfer price. Finally, we demonstrate, how supplementary lump-sum payments among the divisions may solve well-known problems of inefficiency.
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Martini JT, Haake C-J. Negotiated Transfer Pricing in a Team-Investment Setting. Discussion paper / Fakultät für Wirtschaftswissenschaften, Universität Bielefeld, 523. Bielefeld: Universität Bielefeld; 2004.
Martini, J. T., & Haake, C. - J. (2004). Negotiated Transfer Pricing in a Team-Investment Setting (Discussion paper / Fakultät für Wirtschaftswissenschaften, Universität Bielefeld, 523). Bielefeld: Universität Bielefeld.
Martini, J. T., and Haake, C. - J. (2004). Negotiated Transfer Pricing in a Team-Investment Setting. Discussion paper / Fakultät für Wirtschaftswissenschaften, Universität Bielefeld, 523, Bielefeld: Universität Bielefeld.
Martini, J.T., & Haake, C.-J., 2004. Negotiated Transfer Pricing in a Team-Investment Setting, Discussion paper / Fakultät für Wirtschaftswissenschaften, Universität Bielefeld, 523, Bielefeld: Universität Bielefeld.
J.T. Martini and C.-J. Haake, Negotiated Transfer Pricing in a Team-Investment Setting, Discussion paper / Fakultät für Wirtschaftswissenschaften, Universität Bielefeld, 523, Bielefeld: Universität Bielefeld, 2004.
Martini, J.T., Haake, C.-J.: Negotiated Transfer Pricing in a Team-Investment Setting. Discussion paper / Fakultät für Wirtschaftswissenschaften, Universität Bielefeld, 523. Universität Bielefeld, Bielefeld (2004).
Martini, Jan Thomas, and Haake, Claus-Jochen. Negotiated Transfer Pricing in a Team-Investment Setting. Bielefeld: Universität Bielefeld, 2004. Discussion paper / Fakultät für Wirtschaftswissenschaften, Universität Bielefeld, 523.
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