Procurement and predation: Dynamic sourcing from financially constrained suppliers

• 成果类型: Article
• 署名作者: Arve, Malin
• 署名单位: University of Mannheim
• 刊物名称: JOURNAL OF PUBLIC ECONOMICS
• ISSN/ISSBN: 0047-2727
• DOI: 10.1016/j.jpubeco.2014.09.007
• 发表日期: 2014
• 页码: 157-168
• 关键词: Asymmetric information; DUAL SOURCING; favoritism; financial constraints; procurement

摘要

This paper studies the relationship between a financially constrained firm and a stronger opponent who is not cash-constrained when these firms repeatedly compete in a procurement context. We characterize and discuss the procurement agency's optimal strategy when faced with such asymmetric firms. We highlight a trade-off between the long-run benefits from competition and the short-run benefits from reduced costs. Finally, we show that to reduce costs in the short run, the financially weak firm should be favored in future procurement. (C) 2014 Elsevier B.V. All rights reserved.