Highlights: [�] We model coupon trading and its impacts on consumer purchase and firm profits. [�] Retailer and manufacturers can benefit from coupon trading, but not simultaneously. [�] Coupon trading enables firms to charge higher prices and obtain higher profits. [�] Firms can be more profitable with coupon trading than improved coupon targeting. [�] Coupon trading combined with incentive mechanisms may lead to a Pareto improvement.
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