Study on Ex-Post Verifiable Adverse Selection in Supply Chain with Long-Term Cooperation Prospect

The thesis firstly studies how to coordinate a one-off supply chain involving decision-maker's adverse selection which is described under common hypothesis, and finds a Second-Best coordination model which is the best choice on such an occasion. Thereafter, extending the one-off relationship to...

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Bibliographic Details
Main Authors: Zhang, Jian-Jun, Zhao, Jin, Huo, Jia-Zhen
Format: Conference Proceeding
Language:English
Subjects:
Appraisal
Contracts
Costs
Economic forecasting
Ethics
Hazards
Probes
Supply chain management
Supply chains
Warranties
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Summary:The thesis firstly studies how to coordinate a one-off supply chain involving decision-maker's adverse selection which is described under common hypothesis, and finds a Second-Best coordination model which is the best choice on such an occasion. Thereafter, extending the one-off relationship to a long-term cooperation, the thesis reveals that repeated Stackelberg Games between the upper and the lower have influence on supply chain coordination with adverse selection in a long-term background: if the agent's (retailer's) private information of one season is associated with that of others, and is likely to be verified in next season, then whether the supply chain can be optimally coordinated depends on the probability of the private information being post-verified, the retailer's information rent, reservation utility which is yielded when without the cooperation, and his income in symmetry information background. The thesis provides corresponding quantitative descriptions for these conclusions respectively.
ISSN:2161-9646
DOI:10.1109/WICOM.2007.1195