%0 Report
        %A Atz, Ulrich
%A Eliason, Blake
%A Lipsitz, Michael
%A Norlander, Peter
%A Pinto, Sérgio
%A Steinbaum, Marshall
        %T The Balance of Power in Franchising
        %D 2026
        %8 2026 May
        %I Institute of Labor Economics (IZA)
        %C Bonn
        %7 IZA Discussion Paper
        %N 18660
        %U https://www.iza.org/index.php/publications/dp18660
        %X We measure how the contractual balance of power between franchisors and franchisees has shifted over 2009-2024 by analyzing a large corpus of Franchise Disclosure Documents and surveying over 300 franchisees. Coding more than 20 provisions across 4,500 chains, we find that franchisee autonomy declined systematically: exclusive territories fell from a majority of chains to around 20\%, while restrictions on pricing, sourcing, product offerings, and post-term competition each rose to near-universal prevalence. Franchisees appear not to have been compensated for this loss of autonomy: franchise fees rose with franchisor control, chain growth did not increase, and complaint rates to the Federal Trade Commission did not decline. We additionally find that chains that adopt franchisor-favoring provisions became 2-5 percentage points more likely to be acquired by private equity within five years. We interpret this finding as one plausible explanation for reductions in franchisee autonomy.
        %K vertical restraints
%K franchising
%K text analysis
%K survey