![](/images/graphics-bg.png)
The Quota-Based Compensation Plan in Fashion Retailing Industry under Asymmetric Information
Joint Authors
Yu, Mingzhu
Ma, Lijun
Yang, Ruina
Source
Mathematical Problems in Engineering
Issue
Vol. 2014, Issue 2014 (31 Dec. 2014), pp.1-11, 11 p.
Publisher
Hindawi Publishing Corporation
Publication Date
2014-06-01
Country of Publication
Egypt
No. of Pages
11
Main Subjects
Abstract EN
We study a compensation plan problem in the fashion retailing industry, which involves a risk-neutral fashion retailer and a risk-neutral salesperson, in a two-stage game framework with asymmetric information.
In the first stage, the fashion retailer provides a menu of compensation plans to the salesperson who decides which plan to sign based on his superior market demand information.
Confronted with the asymmetric demand information, the fashion retailer could observe market information from the salesperson's response by designing a menu of compensation plans rather than a single one to the salesperson.
In the second stage, the fashion retailer then makes production decision and the salesperson determines his selling effort.
We consider both adverse selection and moral hazard.
We adopt the quota-based plan to derive the fashion retailer’s optimal compensation plan design and the salesperson's best response.
We emphasize the impact of the quota level on the system outcomes.
The results reveal that a higher quota level is disadvantageous to the fashion retailer but advantageous to the salespersons.
American Psychological Association (APA)
Yu, Mingzhu& Yang, Ruina& Ma, Lijun. 2014. The Quota-Based Compensation Plan in Fashion Retailing Industry under Asymmetric Information. Mathematical Problems in Engineering،Vol. 2014, no. 2014, pp.1-11.
https://search.emarefa.net/detail/BIM-458531
Modern Language Association (MLA)
Yu, Mingzhu…[et al.]. The Quota-Based Compensation Plan in Fashion Retailing Industry under Asymmetric Information. Mathematical Problems in Engineering No. 2014 (2014), pp.1-11.
https://search.emarefa.net/detail/BIM-458531
American Medical Association (AMA)
Yu, Mingzhu& Yang, Ruina& Ma, Lijun. The Quota-Based Compensation Plan in Fashion Retailing Industry under Asymmetric Information. Mathematical Problems in Engineering. 2014. Vol. 2014, no. 2014, pp.1-11.
https://search.emarefa.net/detail/BIM-458531
Data Type
Journal Articles
Language
English
Notes
Includes bibliographical references
Record ID
BIM-458531