Mean-variance analysis of supply chains under wholesale pricing and profit sharing schemes
(2010) European Journal of Operational Research — Vol. 204, n° 2, p. 255-262 (2010)
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- Authors
- Abstract
- In this paper, we explore the use of a wholesale pricing and profit sharing scheme (WPPS) for coordinating supply chains under the mean-variance (MV) decision framework. We first analytically establish the necessary and sufficient conditions for coordinating the centralized supply chain by WPSS. We then show that there exists a unique equilibrium of the Stackelberg game with WPPS in the decentralized case. After that, we discuss the information asymmetric case in which the retailer can be benefited by pretending to be more risk averse. Finally, we propose a new measure for the manufacturer to prevent this cheating from happening. Insights are generated.
- Affiliations
Hong Kong Polytechnic University Institute of Textiles and clothing
Citations
Wei, Y., & Choi, T.-M. (2010). Mean-variance analysis of supply chains under wholesale pricing and profit sharing schemes. European Journal of Operational Research, 204(2), 255-262. https://doi.org/10.1016/j.ejor.2009.10.016 (Original work published 2010)