Kashefi, Mohammad Ali (2012): Supply chain configuration under information sharing.
Download (191kB) | Preview
This paper examines the effect of information sharing on supply chain configuration where the market characterized by demand uncertainty. A dynamic multi-stage game theoretic model with incomplete information is employed to capture the sequence of events. Our supply chain consists of two suppliers with exogenous wholesale prices and two retailers, the incumbent and the entrant, with asymmetric demand information. Informed incumbent prefers to conceal its private information from the entrant in order to reap more profits in the market. The channel of information flows is only through the first supplier and the incumbent can supply just from him, but the entrant is free to choose its proper supplier considering the point that the second supplier is uninformed. Our analytical model demonstrates that how the mean demand of the market, wherein our retailers compete, and its relation with the relative wholesale price of the suppliers play crucial role in equilibrium determination. Our results show under which circumstances separation and pooling equilibrium could occur in some range of demand variation. It is also shown that the entrant sometimes prefers to avoid information acquisition by choosing the second supplier and playing Cournot instead of Stackelberg which is more profitable for him in some occasions.
|Item Type:||MPRA Paper|
|Original Title:||Supply chain configuration under information sharing|
|Keywords:||Information Sharing, Asymmetric Information, Supply Chain, Dynamic Game, Signaling Game, Demand Uncertainty, Strategic Information Management|
|Subjects:||M - Business Administration and Business Economics; Marketing; Accounting > M1 - Business Administration > M11 - Production Management
Y - Miscellaneous Categories > Y4 - Dissertations (unclassified) > Y40 - Dissertations (unclassified)
L - Industrial Organization > L1 - Market Structure, Firm Strategy, and Market Performance > L13 - Oligopoly and Other Imperfect Markets
L - Industrial Organization > L8 - Industry Studies: Services > L81 - Retail and Wholesale Trade; e-Commerce
C - Mathematical and Quantitative Methods > C6 - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling > C61 - Optimization Techniques; Programming Models; Dynamic Analysis
D - Microeconomics > D8 - Information, Knowledge, and Uncertainty > D82 - Asymmetric and Private Information; Mechanism Design
C - Mathematical and Quantitative Methods > C7 - Game Theory and Bargaining Theory > C72 - Noncooperative Games
|Depositing User:||Mohammad Ali Kashefi|
|Date Deposited:||24. Sep 2012 02:36|
|Last Modified:||16. Feb 2013 08:50|
Anand, K & Goyal, M 2009, ‘Strategic information management under leakage in a supply chain’, Management Science, vol. 55, no. 3, pp. 438-452.
Cachon, G & Lariviere, M 2005, ‘Supply chain coordination with revenue-sharing contracts: strengths and limitations’, Management Science, vol. 51, no. 1, pp. 30-44.
Cachon, G 2003, ‘Supply chain coordination with contracts’, In AG de Kok & SC Graves (eds.), Handbooks in Operations Research and Management Science, vol. 11. Elsevier, Boston, pp. 229-340.
Chen, F 2003, ‘Information sharing and supply chain coordination’, In SC Graves & T de Kok (eds.), Handbooks in Operations Research and Management Science: Supply Chain Management, North Holland, Amsterdam, pp. 229-340.
Cho, I & Kreps, M 1987, ‘Signaling Games and Stable Equilibria’, The Quarterly Journal of Economics, vol. 102, no. 2, pp. 179-222.
Fundenberg, D & Tirol, J 1993, Game Theory, MIT Press, Cambridge.
Gal-Or, E 1985, ‘Information Sharing in Oligopoly’, Econometrica, vol. 53, no. 2, pp. 329-343.
Ghosh, A & Fedorowicz, J 2008, ‘The role of trust in supply chain governance’, Business Process Management Journal, vol. 14, no. 4, pp. 453-470.
Gibbons, R 1992, Game theory for applied economists, Princeton University Express, Princeton, NJ.
Ha, A & Tong, S 2008, ‘Contracting and information sharing under supply chain competition’, Management Science, vol. 52, no. 4, pp. 701-715.
Ha, A & Tong, S & Zhang, H 2011, ‘Sharing Demand Information in Competing Supply Chains with Production Diseconomies’, Management Science, vol. 57, no. 3, pp. 566-581.
Kong, G & Rajagopalan, S & Zhang, H 2012, ‘Revenue Sharing and Information Leakage in a Supply Chain’, Working Paper IOM 6-12 Marshall School of Business, University of Southern California, CA.
Lee, H 2004, ‘The Triple-A Supply Chain’, Harvard Business Review, October, pp. 102-112.
Lee, HL & Kut, C & Tang, Ch 2000, ‘The Value of Information Sharing in a Two-Level Supply Chain’, Management Science, vol. 46, no. 5, pp. 626-643.
Lee, HL & Whang, S 2000, ‘Information sharing in a supply chain’, International Journal of Technology Management, vol. 20, pp. 373-387.
Li, L 2002, ‘Information Sharing in a Supply Chain with Horizontal Competition’, Management Science, vol. 48, no. 9, pp. 1196-1212.
Liu, R & Kumar, A & Stenger, A 2006, ‘Simulation Results for Supply Chain Configurations Based on Information Sharing’, Proceedings of the IEEE 2006 Winter Simulation Conference, pp. 627-635.
Özer, Ö & Zheng, Y & Chen, K 2011, ‘Trust in Forecast Information Sharing’, Management Science, vol. 57, no. 6, pp. 1111-1137.
Shy, O 1995, Industrial Organization, MIT Press, Cambridge.
Zhang, C & Li, S 2006, ‘Secure Information Sharing in Internet-Based Supply Chain Management Systems’, Journal of Computer Information Systems, vol. 46, no. 4.
Zhang, H 2002, ‘Vertical information exchange in a supply chain with duopoly’, Production and Operations Management, vol. 11, no. 4, pp. 531-546.
Ziv, Amir 1993, ‘Information Sharing in Oligopoly: The Truth-Telling Problem’, The RAND Journal of Economics, vol. 24, no. 3, pp. 455-465.