TY  - RPRT
        AU  - Atz, Ulrich
AU  - Eliason, Blake
AU  - Lipsitz, Michael
AU  - Norlander, Peter
AU  - Pinto, Sérgio
AU  - Steinbaum, Marshall
        TI  - The Balance of Power in Franchising
        PY  - 2026/May/
        PB  - Institute of Labor Economics (IZA)
        CY  - Bonn
        T2  - IZA Discussion Paper
        IS  - 18660
        UR  - https://www.iza.org/index.php/publications/dp18660
        AB  - 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.
        KW  - vertical restraints
KW  - franchising
KW  - text analysis
KW  - survey
        ER  -