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Optimal shared-savings contracts in supply chains: linear contracts and double moral hazard

Authors :
Corbett, Charles J.
DeCroix, Gregory A.
Ha, Albert Y.
Source :
European Journal of Operational Research. June 16, 2005, Vol. 163 Issue 3, p653, 15 p.
Publication Year :
2005

Abstract

An analysis of the supply chain problems in the cases of shared-savings contracts is presented. In the context of consumption of indirect materials the supplier can offer shared-incentives to the customers, which linear contract can however be exploited by either the customer or the supplier to the detriment of the other. An optimal solution to the situation is suggested.

Details

Language :
English
ISSN :
03772217
Volume :
163
Issue :
3
Database :
Gale General OneFile
Journal :
European Journal of Operational Research
Publication Type :
Academic Journal
Accession number :
edsgcl.128038475