ABSTRACT
Three major frameworks are evident in the marketing literature describing marketing channel evolution: economic, behavioural, and more recently, managerial models. Each has taken a different tact. Economic models of channel evolution are direct applications of the classical microeconomic paradigm as developed by Coase (1937), Stigler (1951), Bucklin (1960, 1971, 1972), and Mallen (1973). In this view, marketing channels are subordinated to the cost minimization goals of producers. Every producing firm thus tends to organize its marketing channels in order to minimize operating costs. An important consequence of this approach is that distributive institutions (for example, wholesalers and retailers) are perceived as totally dependent on producer choices, and their own strategy is ignored. Similarly, total marketing channel productivity becomes the chief dimension of channel performance.
