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Dynamic Pricing and Supply Coordination with Reimbursement Contract under Random Yield and Demand
Joint Authors
Li, Guo
Yue, Xiaohang
Wang, Zhaohua
Ran, Lun
Source
Discrete Dynamics in Nature and Society
Issue
Vol. 2013, Issue 2013 (31 Dec. 2013), pp.1-10, 10 p.
Publisher
Hindawi Publishing Corporation
Publication Date
2013-11-11
Country of Publication
Egypt
No. of Pages
10
Main Subjects
Abstract EN
This paper investigates the dynamic pricing and supply chain coordination in a decentralized system that consists of one supplier and one manufacturer, in which both the market demand and production yield are stochastic.
We show that the centralized expected profit is jointly concave in the production quantity and order quantity when the price is ex-ante selected.
We also derive the equilibrium strategies in the decentralized system and prove that the entire profit of supply chain is inevitably lower than that under centralized system.
Based on this, we propose a reimbursement contract to coordinate the decentralized supply chain so as to achieve the maximized profit.
It is worth mentioning that, under reimbursement contract, the equilibrium production and order quantities are irrelevant to the manufacturer's risk sharing coefficient but are only determined by the supplier’s risk sharing coefficient.
American Psychological Association (APA)
Li, Guo& Ran, Lun& Yue, Xiaohang& Wang, Zhaohua. 2013. Dynamic Pricing and Supply Coordination with Reimbursement Contract under Random Yield and Demand. Discrete Dynamics in Nature and Society،Vol. 2013, no. 2013, pp.1-10.
https://search.emarefa.net/detail/BIM-486632
Modern Language Association (MLA)
Li, Guo…[et al.]. Dynamic Pricing and Supply Coordination with Reimbursement Contract under Random Yield and Demand. Discrete Dynamics in Nature and Society No. 2013 (2013), pp.1-10.
https://search.emarefa.net/detail/BIM-486632
American Medical Association (AMA)
Li, Guo& Ran, Lun& Yue, Xiaohang& Wang, Zhaohua. Dynamic Pricing and Supply Coordination with Reimbursement Contract under Random Yield and Demand. Discrete Dynamics in Nature and Society. 2013. Vol. 2013, no. 2013, pp.1-10.
https://search.emarefa.net/detail/BIM-486632
Data Type
Journal Articles
Language
English
Notes
Includes bibliographical references
Record ID
BIM-486632