Note on Optimal Procurement Mechanisms for Assembly

• 成果类型: Article
• 署名作者: Shan, Xi; Ye, Lixin; Zhang, Chenglin
• 署名单位: State University of New York (SUNY) System; SUNY Plattsburgh; University System of Ohio; Ohio State University; The Chinese University of Hong Kong, Shenzhen; Southwestern University of Finance & Economics - China
• 刊物名称: M&SOM-MANUFACTURING & SERVICE OPERATIONS MANAGEMENT
• ISSN/ISSBN: 1523-4614
• DOI: 10.1287/msom.2024.0907
• 发表日期: 2024
• 关键词: passive beliefs; Supply chain management; Lack of commitment; contract theory; informed principal

摘要

Problem definition : We consider contract confidentiality in a decentralized supply chain, in which a single principal orders different components from different agents, each of which has private cost information. The principal may commit to publicly observed bilateral contracts or offer secretly observed contracts to each agent simultaneously. We also consider the problem of sequential contracting. Methodology/results : By correcting the main analysis in Hu and Qi [Hu B, Qi A (2018) Optimal procurement mechanisms for assembly. Manufacturing Service Oper. Management 20(4):655-666], we employ passive beliefs to study secret contracting. We show that there is a unique configuration of twopart tariffs under secret offers in both simultaneous and sequential contracting. We also extend the analysis to take into account ex post individual rationality (IR), which is arguably more relevant in this assembly setting. With ex post IR, we show that the traditional two-part tariffs should be augmented with payment adjustments. Managerial implications : We find that the efficiency achieved through public offers can be maintained with secret offers in this assembly setting contrary to conventional wisdom. Our analysis, thus, offers an explanation for why nondisclosure agreements are important and common in practice.