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Economic Analysis on the Wage Policy of Multi-level Marketing Based on Principal-agent

Author: GuoLiMin
Tutor: NiePuZuo
School: Jinan University
Course: Industrial Economics
Keywords: Multilevel marketing Sharecropping Principal - agent Distorted incentives Risk-sharing
CLC: F713.32
Type: Master's thesis
Year: 2011
Downloads: 136
Quote: 1
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Abstract


Direct face-to-face sales , it is self - generated up to now has always been the focus of debate is not fixed retail outlets , various scholars in the field it is also mixed . Capitation different ways , direct marketing is divided into single - level direct selling and multilevel marketing . The multi-level direct sales force can be obtained through the sale of products and development of offline revenue performance . Economic scholars at home and abroad paid little attention to the problem of multilevel marketing economics perspective , the article illustrates the use of a multi-level direct pay system , from economics to illustrate the differences and relations of direct sales and MLM . The article mainly uses the principal-agent economics analysis tools , to reveal the nature of the direct analysis of theories and models : the direct incentive pay system distortions will only promote direct sales force focused on the development off the assembly line , and direct sales personnel commitments pass on the direct selling company high-risk and high cost . At the same time , the multi- level direct selling direct selling company is efficient business model , it is inefficient for the direct sales force . Study multilevel marketing pay system based on the article further reflection , direct sales and MLM are keen to recruit downline and do business acquaintances in common , and direct the flow of goods and services, MLM is not difference. At the same time , the paper proposes the system of salaries and bonuses to direct the specification . Finally, future development of our direct sales trend : China may gradually expand the area to allow the implementation of direct , and on the basis of the salary adjustment system , with sound legal norms and strong supervision of law enforcement agencies as a guarantee, multi-level direct successful transformation .

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CLC: > Economic > Trade and Economic > Domestic Trade and Economic > The circulation of commodities and the market > Sale of goods > Retail Trade
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