multiattribute preference analysis with performance targets this paper develops an approach based on performance targets to assess a preference function for a multiobjective decision under uncertainty this approach yields preference functions that are strategically equivalent to conventional multiattribute utility functions but the target oriented approach is more natural for some classes of decisions in some situations the target oriented preference conditions are analogous to reliability theory conditions for series or parallel failure modes in a system in such cases reinterpreting the conditions using reliability concepts can be useful in assessing the preference function the target oriented approach is also a generalization of common forms of goal programming the approach has particular applicability for resource allocation decisions where the outcome of the decision is significantly determined by the actions of other stakeholders to the decision such as new product development or decision making in a controversial regulated environment

analysis of protection and pricing strategies for digital products under uncertain demand abstract we analyze pricing and protection digital rights management strategies in a two echelon supply chain that consists of a manufacturer and a retailer of digital products the demand for the legal non pirated product which depends on both price and monetary investment in protection is assumed to be uncertain three different supply chain models are analyzed manufacturer stackelberg retailer stackelberg and vertical integration we show that the retailer s utility function has no effect on the equilibrium strategies and suggest schemes to find these strategies for any utility function of the manufacturer further results are obtained under assumptions of either a multiplicative or an additive demand model we study the players strategies under different profit criteria reflecting different attitudes toward risk specifically the expectation criterion and the target criterion and for each criterion we obtain the dependence between the pricing and the protection investment we show that there are situations in which the manufacturer can increase his profit by giving up his leadership to the retailer even if the power balance is in his favor

contingency fit institutional fit and firm performance a metafit approach to organization environment relationships in this paper we attempt to reconcile contingency and institutional fit approaches concerning the organization environment relationship whereas prior scholarly research has examined both theories and compared their impacts on organizational fit and performance we lay the groundwork for a metafit approach by investigating how contingency and institutional fit interact to influence firm performance we test our theoretical framework using a data set of 3 259 respondents from 1 904 companies examining task environmental demands and institutional demands on organizational design across a broad range of industries and firm size classes our results show that contingency and institutional fit provide complementary and interdependent explanations of firm performance importantly our findings indicate that for firms under conditions of quasi fit rather than perfect contingency fit or optimal institutional fit improvements in contingency and or institutional fit will result in better performance however firms with high contingency fit are less vulnerable to deviation from institutional fit in the formation of firm performance whereas firms with perfect institutional fit will slightly decrease their performance when they strive to achieve contingency fit

a price setting newsvendor problem under mean variance criteria the single product single period newsvendor problem with two decision variables namely price and stock quantity is considered the performance measure in addition to the expected revenue includes the variance of the income scaled with a risk parameter we present conditions for the concavity of this risk sensitive performance measure and the uniqueness of the optimal solution for both risk averse and risk seeking cases under the additive demand model and compare the results to others previously published these conditions are introduced in terms of the lost sales rate elasticity furthermore we provide numerical examples that aim to endorse the theoretical results herein explained

on the relationship between entropy demand uncertainty and expected loss abstract we analyze the effect of demand uncertainty as measured by entropy on expected costs in a stochastic inventory model existing models studying demand variability s impact use either stochastic ordering techniques or use variance as a measure of uncertainty due to both axiomatic appeal and recent use of entropy in the operations management literature this paper develops entropy s use as a demand uncertainty measure our key contribution is an insightful proof quantifying how costs are non increasing when entropy is reduced

the risk averse and prudent newsboy the effects of risk and risk aversion in the single period inventory newsboy problem are examined comparative static effects of changes in the various price and cost parameters are determined and related to the newsboy s risk aversion the addition of a random background wealth and of an increase in the riskiness of newspaper demand are also examined although many of the comparative effects generally are ambiguous some fairly simple restrictions on preferences and or risk increases are shown to lead to qualitatively deterministic results

the effect of advertising on the distribution free newsboy problem abstract advertising is very important for the newsboy problem because the shelf life of the newsboy product is short and advertising may increase sales to avoid overstocking in this paper models to study the effect of advertising are developed for the distribution free newsboy problem where only the mean and variance of the demand are known as in khouja and robbins 2003 it is assumed that the mean demand is an increasing and concave function of advertising expenditure three cases are considered 1 demand has constant variance 2 demand has constant coefficient of variation and 3 demand has an increasing coefficient of variation this paper provides closed form solutions or steps to solve the problem numerical results of the model are also compared with those from other papers the effects of model parameters on optimal expenditure on advertising optimal order quantity and the lower bound on expected profit are derived or discussed

politically realistic objective functions and trade policy profs and tariffs abstract this paper demonstrates a mathematical correspondence between the deus ex machina tariff formation approach and political economy approach the correspondence implies that the tariff chosen by lobbying influenced policy makers will be equivalent to a tariff chosen by a deus ex machina government that gives too much weight to profits this result allows many political economy issues to be addressed in the simple framework of a deus ex machina government which faces a politically realistic objective function prof

explaining ijv survival in a transitional economy through social exchange and knowledge based perspectives in this study we combine social exchange and knowledge based perspectives to develop a general path model of ijv survival we further refine our expectations by considering the transitional economic context of our study and the somewhat unique managerial values resulting from the legacy of marxist ideology results from structural equation modeling suggest that an imbalance in the management control structure between the parents leads to parental conflict and an increased likelihood of ijv failure an imbalance in the ownership control structure however had no influence on conflict or survival in general support from the foreign parent is positively related to ijv learning and ijv survival however higher levels of technical support provided by the foreign parent to the ijv reduced the level of parental conflict whereas management support had no effect on conflict our results suggest some dilemmas for firms pursuing ijvs in transitional economies although the foreign parent often contributes critical resources to the ijv providing it with bargaining power and a high level of influence an imbalance in management control between the partners may ultimately be detrimental to ijv survival copyright 2000 john wiley sons ltd

optimum tariffs and retaliation how country numbers matter abstract this paper identifies a new terms of trade externality that is exercised through tariff setting a north south model of international trade is introduced in which the number of countries in each region can be varied as the number of countries in one region is increased each government there competes more aggressively with the others in its region by lowering its tariff to attract imports from the other region in doing so all countries in a region exert a negative terms of trade externality on each other collectively undermining their own terms of trade and welfare this externality can increase efficiency if the numbers of countries in both regions are increased simultaneously

capabilities as a mediator linking resources and the international performance of entrepreneurial firms in an emerging economy this study investigates an under researched topic the relationships between capabilities resources and international performance among entrepreneurial firms in an emerging economy we combine the resource based view of the firm and the capability building perspective of rent creation to shed light on the crucial role of firm specific capabilities that transform key resources into performance outcomes employing a large sample of chinese entrepreneurial firms our investigation demonstrates that while the resources of institutional capital and managerial ties are important in the internationalization effort their effects on international performance are channeled through each firm s adaptive capability this adaptive capability is the firm s ability to coordinate recombine and allocate resources to meet the different requirements of foreign markets specifically our research is able to demonstrate support for the mediating role of capabilities in the relationship between resources and international performance the implications of these findings for theoretical development and future research are discussed

newsvendor problem with random shortage cost under a risk criterion abstract we study profit maximization vs risk approaches for the standard newsvendor problem with uncertainty in demand as well as a generalized version with uncertainty in the shortage cost as often applies in practice we consider two well known risk approaches value at risk var included as a constraint and conditional value at risk cvar we first derive the explicit expressions of the optimal solution with uncertainty of shortage cost under different risk measures and then perform a numerical analysis to quantify the effect of uncertainty in shortage cost and risk measures for the standard newsvendor problem we find that the optimal quantity under cvar is always lower than that under the var constraint which in turn is lower than the order quantity that maximizes the expected profit insightful explanations for this result are that a a higher degree of risk aversion drives the newsvendor to order fewer products increasing the likelihood that all will be sold b this effect is stronger for the cvar approach as this does not consider the expected profit at all another interesting and counter intuitive observation for the cvar approach is that a higher retail price may lead to a smaller order quantity as fewer items need to be sold in order to attain a sufficient profit these results show that one should be careful in employing the cvar risk measure for newsvendor type problems the results remain valid if the shortage cost becomes uncertain however increased uncertainty of this type does improve the relative profitability under the cvar approach by increasing the order quantity under that criterion whilst there is no effect under the other criteria

a three person game theory model arising in stochastic inventory control theory abstract in this paper we build a game theory model for a single period inventory problem where each of three retailers tries to determine his optimal order quantity their products are substitutable and have random demands therefore multiple direction demand transfers occur when one or more retailers are sold out it is shown that by using nash equilibrium optimal decision exists for each retailer when they work independently the optimal order quantity in this case is larger than that under the newsboy problem model this is because substitution can be a source of sales and hence a justification for inventory in situations where some retailer may act irrationally to inflict a damage on the others the defensive strategy for the latter is to totally ignore the existence of the irrational player we also study the cooperation of retailers by switching excess inventory to those who have excess demand both when side payments are and are not allowed if side payments are not allowed secure nash strategies always exist for each retailer and cooperation will reduce inventory the latter is especially true when the depreciation of value of the item and or inventory carrying cost are large we give conditions for cooperation in both cases and show that although all player cooperation is often feasible it may not always be obtainable even if side payments are allowed

the performance of cross border units in china a test of natural selection strategic choice and contingency theories this study tests the explanatory power of three theoretical frameworks for the performance of cross border affiliates by examining the experience of 615 hong kong firms managing operations in mainland china the frameworks tested are the natural selection approach focused on the influence of the environment the strategic choice approach focused on managerial action and the contingency approach which emphasises the fit between environmental contingencies and internal organisation the results show that natural selection and strategic choice have a role to play even when controlling for each other they also support a simple approach to contingency but not a more complex version involving interactions although the business and institutional environments do have a significant influence on the performance of cross border affiliates in a transition economy performance can be improved through strategic managerial action in particular leveraging local resources by developing trust between parent and affiliate and maintaining close control and integration with the parent are associated with enhanced performance

order variability in perishable product supply chains abstract empirical research has shown that the degree of order variability in supply chains is significantly influenced by product and industry specific factors this paper analyzes the impact of perishability on order variability and the bullwhip effect in supply chains we decompose the ordering process of a retailer into a sales and an outdating process and quantify their short and long term variability and correlation we find differences to non perishable product supply chains driven by the impact of the inventory depletion policy stock out management and retailers service level requirement these three factors significantly affect the retailer s order variability and thus the decision making process and the profitability of the upstream supply stage for the majority of instances the perishable nature of a product results in the ordering process having a lower variability than the demand process only when inventory depletion is dominated by last in first out in high service level environments variability amplification can be observed we propose a dynamic ordering policy for the upstream supply stage taking into account negative correlation of retailer orders between periods this dynamic policy may lead to substantial performance improvements in a sensitivity analysis we investigate the impact of shelf life lead time and demand correlation

an assessment of the measurement of performance in international business research a sizeable body of international business ib research is devoted to building knowledge about the determinants of organizational performance a key precursor to accurately diagnosing why some organizations succeed in the international marketplace while others struggle is operationalizing performance appropriately yet to date no systematic investigation has considered how well ib research measures performance we examine the measurement of performance in 96 articles published in the academy of management journal administrative science quarterly journal of marketing journal of marketing research journal of international business studies management science organization science a nd thestrategic management journal between 1995 and 2005 the findings reveal that most studies do not measure performance in a manner that captures the multifaceted nature of the construct we describe the implications of these results and offer suggestions for improving future practice journal of international business studies 2008 39 1064 1080

a single period inventory placement problem for a supply chain with the expected profit objective consider the expected profit maximizing inventory placement problem in an n stage supply chain facing a stochastic demand for a single planning period for a specialty item with a very short selling season each stage is a stocking point holding some form of inventory e g raw materials subassemblies product returns or finished products that after a suitable transformation can satisfy customer demand stocking decisions are made before demand occurs because of delays only a known fraction of demand at a stage will wait for shipments unsatisfied demand is lost the revenue salvage value ordering shipping processing and lost sales costs are proportional there are fixed costs for utilizing stages for stock storage after characterizing an optimal solution we propose an algorithm for its computation for the zero fixed cost case the computations can be done on a spreadsheet given normal demands for the nonnegative fixed cost case we develop an effective branch and bound algorithm

exchange hazards relational reliability and contracts in china the contingent role of legal enforceability building on institutional and transaction cost economics this article proposes that legal enforceability increases the use of contract over relational reliability e g beliefs that the other party acts in a non opportunistic manner to safeguard market exchanges characterized by non trivial hazards the results of 399 buyer supplier exchanges in china show that 1 when managers perceive that the legal system can protect their firm s interests they tend to use explicit contracts rather than relational reliability to safeguard transactions involving risks i e asset specificity environmental uncertainty and behavioral uncertainty and 2 when managers do not perceive the legal system as credible they are less likely to use contracts and instead rely on relational reliability to safeguard transactions associated with specialized assets and environmental uncertainty but not those involving behavioral uncertainty we further find that legal enforceability does not moderate the effect of relational reliability on contracts but does weaken the effect of contracts on relational reliability these results endorse the importance of prior experience e g relational reliability in supporting the use of explicit contracts and alternatively suggest that under conditions of greater legal enforceability the contract signals less regarding one s intention to be trustworthy but more about the efficacy of sanctions

multilateral tariff cooperation during the formation of customs unions abstract we study the implications of customs union formation for multilateral tariff cooperation we model cooperation in multilateral trade policy as self enforcing in that it involves balancing the current gains from deviating unilaterally from an agreed upon trade policy against the future losses from forfeiting the benefits of multilateral cooperation that such a unilateral defection would imply the early stages of the process of customs union formation are shown to alter this dynamic incentive constraint in a way that leads to a temporary honeymoon for liberal multilateral trade policies we find however that the harmony between customs unions and multilateral liberalization is temporary eventually as the full impact of the emerging customs union becomes felt a less favorable balance between current and future conditions re emerges and the liberal multilateral policies of the honeymoon phase cannot be sustained

var as a risk measure for multiperiod static inventory models abstract this paper explores the possibility to use value at risk var in the context of inventory management var is being used more and more in financial management as a natural measure of the risk taken with a given position in the framework of inventory management it can work as well after having built a decision model where the choice concerns the quantity to be ordered to face a random demand in order to optimize the expected result an expected cost to be minimized or an expected profit to be maximized the model explores the probability distribution of the result both via analytical methods and via simulation methods the analytical exploration of this problem has originated a general method to deduce from inequalities for distribution functions which are based on the expected value related tail inequalities which are particularly useful for var problems where only one tail is involved

aggregate constrained inventory systems with independent multi product demand control practices and theoretical limitations in practice inventory managers are often confronted with a need to consider one or more aggregate constraints these aggregate constraints result from available workspace workforce maximum investment or target service level we consider independent multi item inventory problems with aggregate constraints and one of the following characteristics deterministic leadtime demand newsvendor basestock policy rq policy and ss policy we analyze some recent relevant references and investigate the considered versions of the problem the proposed model formulations and the algorithmic approaches finally we highlight the limitations from a practical viewpoint for these models and point out some possible direction for future improvements

financial performance and survival of multinational corporations in china this study investigates the impact of entry timing mode of entry market focus and location advantages on the financial performance and survival of multinational corporations mncs in china three major results were found first mncs that entered china in an earlier year had a higher level of profit than those that entered in a later year second equity joint ventures ejvs had a higher profit level than cooperative operations or wholly foreign owned subsidiaries third mncs that utilized well the location advantages in china had a higher profit we also found that ejvs were more likely to survive compared to cooperative operations while wholly owned subsidiaries did not differ from ejvs the findings are based on a 2 year study of about 1000 mnc operations in china copyright 1999 john wiley sons ltd

technical note a multiperiod model of inventory competition this paper explores when it is important for firms to consider stockout based substitution and competitor s inventory levels in making inventory decisions in the context of a duopoly model to address this question we consider a model where two newsvendors sell substitutable products in a market with aggregate market demand d the two firms get a proportion p and 1 p of this demand where p is random we characterize the equilibrium inventory levels of the two firms in a single period model and show the striking property that under certain reasonable conditions on the cost parameters the two firms ignore their competitor s inventory levels and potential substitution demand i e their inventory decisions are decoupled furthermore we show under slightly more restrictive conditions on the cost parameters that the single period results can be extended to the case where d is random finally we extend the decoupling property to a multiperiod periodic review scenario and show that the resulting nash equilibrium can be characterized simply as the solution to a single product dynamic newsvendor problem that ignores substitution demand

do big countries win tariff wars yes it is widely believed that tariffs invite retaliation and that the postretaliation equilibrium l eaves all countries worse off than they would be at free trade the a uthors present a simple pure exchange model with two countries and t wo goods and show which endowment patterns are consistent with this belief they find that if one country is substantially bigger than th e other it can expect to gain from a tariff war despite retaliation the model can be extended to show that the advantage obtained by bei ng part of a large trading unit can help explain the formation of cus toms unions copyright 1988 by economics department of the university of pennsylvania and the osaka university institute of social and economic research association

comparative statics in a simple class of strategic market games this paper investigates the effects of entry in two sided markets where buyers and sellers act strategically applying new tools from supermodular optimization games sufficient conditions for different comparative statics results are obtained while normality of one good is sufficient for the equilibrium price to be increasing in the number of buyers normality of both goods is required for equilibrium bids and sellers equilibrium utilities to be increasing in the number of buyers when the economy is replicated normality of both goods and gross substitutes guarantee that the equilibrium of the strategic market game converges monotonically in quantities to the competitive equilibrium simple counter examples are provided to settle other potential conjectures of interest c 2007 elsevier inc all rights reserved

a single period inventory placement problem for a supply system with the satisficing objective abstract consider the inventory placement problem in an n stage supply system facing a stochastic demand for a single planning period each stage is a stocking point holding some form of inventory e g raw materials subassemblies product returns or finished products that after a suitable transformation can satisfy demand stocking decisions are made before demand occurs unsatisfied demands are lost the revenue salvage value ordering transformation and lost sales costs are proportional there are fixed costs for utilizing stages for stock storage the objective is to maximize the probability of achieving a given target profit level we prove the existence of optimal stocking decisions where at most three stages receive nonzero stocks we also characterize properties of the optimal stocking decisions and provide an o n 3 algorithm for their computation for the special case where all fixed costs are zero the stages utilized do not depend on the demand distribution or the target level and one can find optimal stocking decisions by performing a simple o n 2 search and solving a single variable optimization problem

stochastic comparisons in production yield management manufacturing firms routinely commit resources to increase yield rates through product and process improvement initiatives champions of such yield improvement projects may assume that stochastically larger yield rates are beneficial in this note we show that this need not hold even when the contingent production lot sizes are chosen optimally we employ stochastic comparison techniques to show that a yield rate that is smaller in the convex order ensures higher expected profit and we provide a distribution free bound on the size of increase in expected profit we also identify properties of yield rate distributions that do make stochastically larger yield rates beneficial

one more time international business in a global economy this paper seeks to redirect the debate on the past present and future of international business ib it sets out to dispel prevailing myths pertaining to the field s disciplinary roots its domain and underlying bases of theory and knowledge ib is positioned as an integrative field whose competitive advantage and added value lie in the synergetic combination of global and local knowledge that is unavailable to and not imitable by its major competitors in particular economics and strategy

risk preferences and robust inventory decisions abstract recently in inventory management instead of maximizing expected profit or minimizing expected cost risk averse objective functions have been used for determining the optimal order quantity we use the well known newsvendor model to determine the optimal order quantity for an objective function with two risk parameters which can describe risk neutral risk averse as well as risk taking behaviour of the inventory manager this approach can also be applied to situations in which the demand distribution cannot be specified uniquely we consider robust optimization procedures maximin and minimax regret to determine optimal order quantities if the set of potential demand variables can be partially ordered by stochastic dominance rules

value at risk and inventory control the purposes of this paper are two fold on the one hand we shall provide a decision analysis justification for the value at risk var approach based on ex post disappointment decision making arguments we shall show that the var approach is justified by a disappointment criterion in other words the asymmetric valuation between ex ante expected returns above an appropriate target return and the expected returns below that same target level provide an explanation for the var criterion when it is used as a tool for var efficiency design second this paper provides applications to inventory management based on var risk exposure although the mathematical problems arising from an application of the var approach tuned to current practice in financial risk management are difficult to solve analytically solutions can be found by application of standard computational and simulation techniques a number of cases are solved and formulated to demonstrate the paper s applicability

an investigation of lead time effects in manufacturing remanufacturing systems under simple push and pull control strategies in this paper we extend the push and pull control strategies defined by van der laan et al e a van der laan m salomon r dekker production planning and inventory control for remanufacturable durable products working paper 9531 a econometric institute erasmus university rotterdam the netherlands 1995 to evaluate numerically the effects of lead time duration and lead time variability on total expected costs in production inventory systems with remanufacturing although both strategies are non optimal they are relatively easy to analyse numerically and more importantly they are actually used in practice the most important outcomes of the study are that for both control strategies i manufacturing lead times have a larger influence on system costs than remanufacturing lead times ii a larger remanufacturing lead time may sometimes result in a cost decrease and iii a larger variability in the manufacturing lead time may sometimes result in a cost decrease

note note on optimal ordering quantity to realize a pre determined level of profit in this note we consider the one period inventory model in which it is required to determine the order quantity which maximizes the probability of realizing a predetermined level of profit r we give a condition for determining the optimal order quantity and provide explicit expressions for the optimal order quantity in three special cases

the risk averse newsvendor problem with random capacity abstract we study the effect of capacity uncertainty on the inventory decisions of a risk averse newsvendor we consider two well known risk criteria namely value at risk var included as a constraint and conditional value at risk cvar for the risk neutral newsvendor we find that the optimal order quantity is not affected by the capacity uncertainty however this result does not hold for the risk averse newsvendor problem specifically we find that capacity uncertainty decreases the order quantity under the cvar criterion under the var constraint capacity uncertainty leads to an order decrease for low confidence levels but to an order increase for high confidence levels this implies that the risk criterion should be carefully selected as it has an important effect on inventory decisions this is shown for the newsvendor problem but is also likely to hold for other inventory control problems that future research can address

the multi product price setting newsvendor with resource capacity constraints abstract in this paper we consider a newsvendor problem commonly encountered in retail stores that cater to budget sensitive shoppers the newsvendor sells multiple products and in addition to determining order quantities must also determine the selling price of each product sold the demand for each product is of a stochastic nature and depends on the demands of other products i e is cross elastic we transform the objective function into a form that is amenable to developing integer programming solutions and then develop a numeric optimization procedure rooted in the nelder mead search technique we obtain encouraging numerical results on some small scale and large scale problems to the best of our knowledge this is the first work that produces implementable solutions for a scenario that is particularly relevant to retailers catering to budget sensitive customers who are abundant in the current economy

optimal ordering quantities for multi products with stochastic demand return cvar model abstract multi product ordering problem with stochastic demand is often optimized by the expected cost reduction or the expected profit improvement in most of previous works moreover risk preference of decision maker is often ignored evidently this approach is impracticable when the corresponding volatility is larger based on the outstanding characteristics of conditional value at risk cvar as a risk measure the paper proposes an optimal order model for multi product with cvar constraints also the model is finally formulated as a linear programming problem the model is simulated for the case of a newsvendor to analyze to what degree it succeeds the solution in fact is bound consistent fully with the decision maker s intuition on return risk decision making finally results of return cvar model and the classical model are compared and shows that return cvar model is more flexible than the classical model

the size of trading blocs market power and world welfare effects abstract we construct an n country n commodity trade model to analyze the implications of bloc size for nash equilibrium tariffs and welfare the relationship between the absolute size of symmetric trading blocs and their market power is ambiguous and we illustrate how this relationship varies with model parameters in contrast sufficiently large increases in the relative size of a bloc enhance its relative market power and cause the welfare of its country members to rise above the free trade level we establish the existence of an optimal bloc size and study the dependence of optimal size on the parameters of the model

on the unimodality of the price setting newsvendor problem with additive demand under risk considerations abstract we present a mean variance analysis of the single product single period price setting newsvendor problem with additive price dependent demand the main goal of this paper is to use a mean variance framework to solve any risk sensitive instance and find conditions under which the unimodality of the problem is guaranteed we introduce such conditions via the lost sales rate elasticity the elasticity of the optimal price and the elasticity of the expected safety stock surplus to provide managerial insight in terms of the newsvendor s level of service we also simplify the optimization problem in case that those conditions do not hold the main contribution of this paper is that by evaluating the unimodality of the problem for any possible risk attitude it extends previously published results found for the concavity of the solution in risk neutral and moderately risk sensitive cases

optimum tariffs and retaliation revisited how country size matters in his seminal work on tariff retaliation johnson review of economic studies 21 1953 1954 showed that a country will win a bilateral tariff war if its relative monopoly monopsony power in world trade is sufficiently large however it is unclear from johnson s analysis and from subsequent research on the subject how this power is determined in general economic environments an important goal of this paper is to address this issue with the help of a neoclassical trade model in which country size is at centre stage it is shown that a sufficient condition for a country to prefer a non cooperative nash tariff equilibrium retaliation over free trade is that its relative size be sufficiently large the paper also refines the structure of the general trade model and generates additional characterization results on the importance of country size for best response tariff functions retaliatory tariffs and welfare

a note on probability distributions with increasing generalized failure rates distributions with an increasing generalized failure rate igfr have useful applications in pricing and supply chain contracting problems we provide alternative characterizations of the igfr property that lead to simplify verifying whether the igfr condition holds we also relate the limit of the generalized failure rate and the moments of a distribution

how larger demand variability may lead to lower costs in the newsvendor problem in this paper we consider the newsvendor problem intuition may lead to the hypothesis that in this stochastic inventory problem a higher demand variability results in larger variances and in higher costs in a recent paper song 1994a has proved that the intuition is correct for many demand distributions that are commonly used in practice such as for the normal distribution function however this paper shows that there exist demand distributions for which the intuition is misleading i e for which larger variances occur in combination with lower costs to characterize these demand distributions we use stochastic dominance relations

developed country mnes investing in developing economies progress and prospect this study reviews research from 1970 through 2016 on developed country multinational enterprises dmnes entering and competing in developing economies to identify the current state of knowledge of this research and push it further we review the literature using bibliometric and qualitative content analyses covering leading journals and books we articulate frontier issues that are understudied yet critical to both theorization and practice of dmnes in developing economies we discuss the findings and conclusions from prior research along five key areas 1 entering developing economies 2 organizing local activities 3 managing alliances and joint ventures 4 competing in dynamic environments and 5 dealing with institutions governments and society we offer prospective insights into future agenda that have important implications for mne strategies and decisions and propose frontier directions that encompass strategic localization reverse transfer and adaptation co evolution with local business ecosystems reorganizing and restructuring and strategic responses to institutional and market complexity

the effect of leadtime uncertainty in a simple stochastic inventory model we study a basic continuous time single item inventory model where demands form a compound poisson process and leadtimes are stochastic the performance measure of interest is the long run average cost order costs are linear so a base stock policy is optimal we focus on the behavior of the optimal base stock level in response to stochastically larger or more variable leadtimes we also investigate the behavior of the corresponding long run average costs we show that a stochastically larger leadtime requires a higher optimal base stock level however a stochastically larger leadtime may not necessarily result in a higher optimal average cost because sometimes the variability effects may dominate on the other hand a more variable leadtime always leads to a higher optimal average cost the effect of leadtime variability on optimal policies depends on the inventory cost structure a more variable leadtime requires a higher optimal base stock level if and only if the unit penalty holding cost rate is high low similar results regarding the effect of leadtime demand are also discussed in this latter case the compound poisson assumption is not necessary

newsvendor model with random supply and financial hedging utility based approach abstract this paper takes a utility based approach to the single period and single item newsvendor model unlike most models in the literature the newsvendor is not necessarily risk neutral and chooses the order quantity that maximizes the expected utility of the cash flow at the end of the period we suppose that there is uncertainty in demand as well as supply furthermore random demand and supply may be correlated with the financial markets the newsvendor exploits this correlation and manages his risks by investing in a portfolio of financial instruments the decision problem therefore includes not only the determination of the optimal ordering policy but also the selection of the optimal portfolio at the same time we first use a minimum variance approach to select the portfolio the analysis results in some interesting and explicit characterizations on the structure of the optimal policy we also present numerical examples to illustrate the effects of the parameters on the optimal order quantity and the importance of financial hedging on risk reduction

decision bias in the newsvendor problem with a known demand distribution experimental evidence in the newsvendor problem a decision maker orders inventory before a one period selling season with stochastic demand if too much is ordered stock is left over at the end of the period whereas if too little is ordered sales are lost the expected profit maximizing order quantity is well known but little is known about how managers actually make these decisions we describe two experiments that investigate newsvendor decisions across different profit conditions results from these studies demonstrate that choices systematically deviate from those that maximize expected profit subjects order too few of high profit products and too many of low profit products these results are not consistent with risk aversion risk seeking preferences prospect theory preferences waste aversion stockout aversion or the consequences of underestimating opportunity costs two explanations are consistent with the data one subjects behave as if their utility function incorporates a preference to reduce ex post inventory error the absolute difference between the chosen quantity and realized demand two subjects suffer from the anchoring and insufficient adjustment bias feedback and training did not mitigate inventory order errors we suggest techniques to improve decision making

multi product newsvendor problem with value at risk considerations abstract we consider the single period stochastic inventory newsvendor problem with downside risk constraints the aim in the classical newsvendor problem is maximizing the expected profit this formulation does not take into account the risk of earning less than a desired target profit or losing more than an acceptable level due to the randomness of demand we utilize value at risk var as the risk measure in a newsvendor framework and investigate the multi product newsvendor problem under a var constraint to this end we first derive the exact distribution function for the two product newsvendor problem and develop an approximation method for the profit distribution of the n product case n 2 a mathematical programming approach is used to determine the solution of the newsvendor problem with a var constraint this approach allows us to handle a wide range of cases including the correlated demand case that yields new results and insights the accuracy of the approximation method and the effects of the system parameters on the solution are investigated numerically

measuring the restrictiveness of trade policy this article provides an introduction to the trade restrictiveness index tri which equals the uniform tariff that is welfare equivalent to a given pattern of trade protection unlike standard measures of trade restrictiveness the tri has a solid theoretical basis can incorporate both tariffs and quantitative restrictions and can be adapted to construct the trade policy equivalent of domestic distortions the article compares a number of applications and describes procedures for operationalizing the tri on a personal computer the authors conclude that the tri has considerable potential in empirical work

a note on the optimal tariff retaliation and the welfare loss from tariff wars in a framework with intraindustry trade abstract this paper uses krugman s 1980 model of trade with product differentiation and monopolistic competition to examine the effects of a uniform ad valorem tariff the main results are there exists an optimal tariff even for a small economy and the optimal tariff rate is an increasing function of the size of the economy and the degree of production differentiation under reasonable parameter assumptions a tariff war between two countries of equal size in which each country retaliates by imposing its own optimal tariff causes a welfare loss equivalent to a drop in income of about 4 percent

effect sizes and the interpretation of research results in international business journal editors and academy presidents are increasingly calling on researchers to evaluate the substantive as opposed to the statistical significance of their results to measure the extent to which these calls have been heeded i aggregated the meta analytically derived effect size estimates obtained from 965 individual samples i then surveyed 204 studies published in the journal of international business studies i found that the average effect size in international business research is small and that most published studies lack the statistical power to detect such effects reliably i also found that many authors confuse statistical with substantive significance when interpreting their research results these practices have likely led to unacceptably high type ii error rates and invalid inferences regarding real world effects by emphasizing p values over their effect size estimates researchers are under selling their results and settling for contributions that are less than what they really have to offer in view of this i offer four recommendations for improving research and reporting practices

inventory competition for newsvendors under the objective of profit satisficing abstract inventory competition for newsvendors nvs has been studied extensively under the objective of expected profit maximization which is based on risk neutrality in this paper we study this classic problem under the objective of profit satisficing which is based on downside risk aversion consistent with prior literature we consider two possible scenarios in the first scenario each nv s demand depends on the stocking levels of all nvs other than herself in this scenario we show that there is a unique nash equilibrium where all nvs optimally order as if they were independent in the second scenario each nv s demand depends on the stocking levels of all nvs including herself we prove the existence of nash equilibrium for both additive and multiplicative forms of demands as a special case we also study symmetrical nvs under the proportional allocation model we show that at equilibrium if the number of nvs exceeds a threshold the market becomes highly competitive

optimal acquisition and remanufacturing policies for multi product remanufacturing systems abstract this paper studies an acquisition and remanufacturing problem in a market driven multi product remanufacturing system where the remanufacturer acquires multiple used products cores of highly variable quality under independently uncertain demand and carbon emissions regulation in order to balance between the environmental and economic benefit the problem is formulated as a nonlinear programming model in presence of the quality variability of cores and carbon tax scheme subject to budget and risk constraints since the average cost of the remanufactured products is independent of the remanufacturing quantity the model is then decomposed into two separated sub problems namely the remanufacturing problem and the acquisition problem in the remanufacturing problem the optimal remanufacturing policies including the optimal remanufacturing cost thresholds and the optimal remanufacturing rate are derived in the acquisition problem the optimal policies of core portfolio acquisition quantities and remanufacturing quantities can be derived the acquisition problem viewed as an extended multi product newsvendor problem mpnp is a convex optimization problem furthermore a two tier bisection method with polynomial computational complexity can be developed to obtain the optimal policies based on the karush kuhn tucker kkt conditions finally numerical experiments are provided to show the application of the model and the effect of the quality variability

pricing and the news vendor problem a review with extensions in the newsvendor problem a decision maker facing random demand for a perishable product decides how much of it to stock for a single selling period this simple problem with its intuitively appealing solution is a crucial building block of stochastic inventory theory which comprises a vast literature focusing on operational efficiency typically in this literature market parameters such as demand and selling price are exogenous however incorporating these factors into the mode l can provide an excellent vehicle for examining how operational problems interact with marketing issues to influence decision making at the firm level in this paper we examine an extension of the newsvendor problem in which stocking quantity and selling price are set simultaneously we provide a comprehensive review that synthesizes existing results for the single period problem and develop additional results to enrich the existing knowledge base we also review and develop insight into a dynamic inventory extension of this problem and motivate the applicability of such models

inventory pooling under heavy tailed demand risk pooling has been studied extensively in the operations management literature as the basic driver behind strategies such as transshipment manufacturing flexibility component commonality and drop shipping this paper explores the benefit of risk pooling in the context of inventory management using the canonical model first studied in eppen eppen gd 1979 effects of centralization on expected costs in a multi location newsboy problem management sci 25 5 498 501 specifically we consider a single period multilocation newsvendor model where n different locations face independent and identically distributed demands and linear holding and backorder costs we show that eppen s celebrated result i e that the expected cost savings from centralized inventory management scale with the square root of the number of locations depends critically on the light tailed nature of the demand uncertainty in particular we establish that the benefit from pooling relative to the decentralized case in term

the competitive newsboy we consider a competitive version of the classical newsboy problem in which a firm must choose an inventory or production level for a perishable good with random demand and the optimal solution is a fractile of the demand distribution and investigate the impact of competition upon industry inventory a splitting rule specifies how initial industry demand is allocated among competing firms and how any excess demand is allocated among firms with remaining inventory we examine the relation between equilibrium inventory levels and the splitting rule and provide conditions under which there is a unique equilibrium our most general result is that if all excess demand is reallocated i e there is perfect substitutability then competition never leads to a decrease in industry inventory

determining factors for the adoption of e business the case of smes in korea this study investigates the determining factors of the successful adoption of e business by small and medium enterprises smes in korea using survey data after the major determining factors were identified from the innovation adoption literature and were extracted by applying the principal component analysis to the survey data and by adding the country specific characteristics of korea we conducted empirical analyses to determine the critical success factors for the adoption of e business by korean firms the empirical results which are based on t tests of the differences between adopters and non adopters the linear probability model and the logit model all suggest that the important determinants of the successful adoption of e business by smes in korea are the ceo s knowledge of information technology it e business relative advantages and benefits from implementing e business governmental support globalization strategy and the north korean factor business size the cost of e business adoptio

on sales effort and pricing decisions under alternative risk criteria abstract in the literature different risk criteria are proposed for risk averse decision making but it is often unclear which risk criteria should be used and what their differences may be this study investigates this problem when a risk averse make to order firm decides its pricing and sales effort two factors affecting demand we consider alternative risk criteria commonly used in the literature namely expected utility theory eut mean variance mv mean semideviation ms value at risk var conditional value at risk cvar and loss aversion la we find that all of these criteria lead to similar qualitative behaviors regarding how risk loss averse decisions deviate from risk neutral ones a particularly interesting result is that the form of demand randomness i e additive or multiplicative can completely reverse the effect of risk loss aversion in certain cases we also find that the risk aversion models i e eut mv ms var and cvar are essentially equivalent in inducing the same set of optimal solutions under adverse market states however loss aversion is a mild version of risk aversion in that the la model can only lead to a subset of the solutions generated by other models these results may not be valid for other applications such as the newsvendor pricing problem so we can conclude that the relationship between alternative risk criteria is case sensitive and should be evaluated more carefully

newsvendor solutions via conditional value at risk minimization abstract in this paper we consider the minimization of the conditional value at risk cvar a most preferable risk measure in financial risk management in the context of the well known single period newsvendor problem which is originally formulated as the maximization of the expected profit or the minimization of the expected cost we show that downside risk measures including the cvar are tractable in the problem due to their convexity and consequently under mild assumptions on the probability distribution of products demand we provide analytical solutions or linear programming lp formulation of the minimization of the cvar measures defined with two different loss functions numerical examples are also exhibited clarifying the difference among the models analyzed in this paper and demonstrating the efficiency of the lp solutions

trade deflection and trade depression this is the first paper to empirically examine whether a country s use of an import restricting trade policy distorts a foreign country s exports to third markets we first develop a theoretical model of worldwide trade in which the imposition of antidumping and safeguard taris or trade remedies by one country causes significant distortions in world trade flows we then empirically test this model by investigating the eect of the united states use of such import restrictions on japanese exports of roughly 4800 products into 37 countries between 1992 and 2001 our estimation yields evidence that us restrictions both deflect and depress japanese export flows to third countries imposition of a us antidumping measure against japan deflects trade as the average antidumping duty on japanese exports leads to a 5 7 increase in japanese exports of the same product to the average third country market the imposition of a us antidumping measure against a third country depresses trade as the average us duty imposed on a third country leads to a 5 19 decrease in japanese exports of that same product to the average third country s market we also document the substantial variation in trade deflection and trade depression across dierent importing countries and exported products

coordination and profit sharing between a manufacturer and a buyer with target profit under credit option several studies have focused on buyer vendor coordination through quantity discount credit option mechanism but few quantitative models and investigations are available that have explored the mechanism for transfer of surplus generated due to coordination in this paper we develop a coordination mechanism through credit option such that both the parties can divide the surplus equitably after satisfying their own profit targets two situations are explored here in the first situation both the parties have no individual profit target from the business whereas in the second situation there are individual profit target for both the parties the proposed mechanism for division of surplus is studied through a numerical study and the impact of different parameter values on the results are examined

risk shaping in production planning problem with pricing under random yield abstract in this paper we address a basic production planning problem with price dependent demand and stochastic yield of production we use price and target quantity as decision variables to control the risk of low production yield the value of risk control becomes more important especially for products with short life cycle where high losses are unbearable in the short run in this cases optimization of a solely scalar function of profit is not sufficient to control the risk we apply conditional value at risk cvar measure to model the risk preferences of the producer the producer is interested in shaping the risk by bounding from below the means of tail distributions of profit for different values of the resulting model is nonconvex we propose an efficient solution algorithm and present a sufficient optimality condition

impact of historical conflict on fdi location and performance japanese investment in china historical relations between countries bring important explanatory power for foreign direct investment fdi decisions yet little is known on whether a home host country relation exhibits heterogeneous effects on fdi across the country s subnational regions in this study we examine the long term impact of historical conflict on fdi location choices and performance using a sample of 8 646 japanese fdi in china we show that civilian casualties in different provinces of china during the second sino japanese war exert deterring effects on japanese fdi location choices furthermore we demonstrate that civilian casualties negatively affect japanese fdi performance and political capital accumulation strategies in the forms of excessive tax payment and local employment can reduce this negative effect this study contributes to the discussion on how within country differences of historical factors affect fdi location decisions and performance the findings on firms political capital accumulation strategies also provide important implications for fdi operation in an environment characterized by historical animosity

the data driven newsvendor with censored demand observations motivated by data from a large european retail chain we tackle the newsvendor problem with censored demand observations by a distribution free approach based on a data driven approach for this purpose we extend the model introduced in chap 3 to improve the forecast accuracy we simultaneously estimate unobservable lost sales determine the coefficients of the exogenous variables which drive demand and calculate the optimal order quantity since demand exceeding supply cannot be recorded we use the timing of hourly sales occurrences to establish daily sales patterns these sales patterns allow conclusions on the amount of unsatisfied demand and thus the true customer demand to determine the coefficients of the inventory function we formulate a linear programming model that balances inventory holding and penalty costs based on the censored demand observations in a numerical study with data generated from the normal and the negative binomial distribution we compare our model with other parametric and non parametric estimation approaches we evaluate the performance in terms of inventory and service level for non price dependent demands and different censoring levels we find that the data driven newsvendor model copes especially well with highly censored data and price dependent demand in most settings with price dependent demand it achieves similar or higher service levels by holding lower inventories than other benchmark approaches from the literature finally we show that the non parametric approaches are better than the parametric ones based on real data with several exogenous variables where the true demand distribution is unknown

optimal tariff calculations in alternative trade models and some possible implications for current world trading arrangements in this paper we report calculations of optimal tariffs both with and without retaliation in a sequence of 2 2 trade models we extend the earlier calculations by johnson 1954 1961 and gorman 1957 which assume constant elasticity offer surfaces by using functional forms from the cobb douglas ces les family for utility functions and by also incorporating production into our calculations results indicate that the most critical parameters in any such calculations for a 2 2 model are the import prices elasticities and we briefly survey the empirical evidence as to their values our major conclusion is that these models confirm the suggestion from casual inspection of reported trade elasticities that current levels of tariff protection are some distance from optimal tariffs and that the margin for tariff retaliation in a worldwide trade war is potentially large other implications of the results are explored in the text

the setting of profit targets for target oriented divisions abstract setting profit targets and striving to achieve them is fundamental to business survival and success however there has been little research on modeling profit target setting in this paper we study analytic target setting under a common business scenario where a firm is in control of multiple divisions both the firm and the divisions maximize the profit probability i e the probability of achieving some given profit target the firm sets a profit target for each division which then acts as a price setting newsvendor we first obtain the optimal order quantity the optimal retail price and the maximal profit probability of a single division given its assigned target we then derive the firm s profit probability and focus on two specific cases to gain more managerial insights in the first case of fair target setting we show that when each division s demand distribution has an increasing failure rate if a division has a relatively high low production cost its assigned profit target decreases increases with regard to its price elasticity in the second case if the firm is in control of two identical divisions each division s optimal profit target is just half of the firm s profit target when the price elasticity is two or more regardless of production cost and demand distribution

how to set price and quality in a supply chain of virtual products under bi criteria and risk consideration abstract virtual products are characterized by ample production capacity zero lead time and no holding costs we consider a two echelon supply chain of a virtual product consisting of a single manufacturer and a single retailer who face random demand demand depends on both price and quality of the product and its stochastic nature exposes the supply chain members to financial risk each party adopts profit criteria that reflect his or her attitude toward this risk including the use of bi criteria by formulating a model that follows a stackelberg game and using the stochastic dominance property we show that one can analytically obtain equilibrium by assuming certain common structures of the demand function and of the risk attitudes the contribution of this study is fourfold i analyzing multiplicative and additive demand forms and comparing the properties of the decisions under the two forms ii showing that under the multiplicative demand form the pricing strategies are not affected by the parties attitudes toward risk whereas the manufacturer s decision on quality investment is affected by his risk attitude iii showing that under the additive demand form the manufacturer s utility function and the demand uncertainty affect pricing and investment strategies and iv suggesting a method to construct the efficient set of decisions and the non dominated set of profit criterion values

critical evidence on comparative advantage north north trade in a multilateral world there are two principal theories of why countries trade comparative advantage and increasing returns to scale which is most important in practice the large volume of intra oecd trade is frequently cited as critical evidence on this question it is argued that comparative advantage unlike scale economies is incapable of accounting for the large volume of trade between seemingly similar economies this is a theoretical claim in this paper i show that it is possible to give an account of this trade based on comparative advantage the elements that may give rise to a large volume of north north trade are traced to identifiable features of technology and endowments

price competition for retailers with profit and revenue targets abstract price competition for retailers has been extensively studied in the literature assuming the objective of expected profit maximization in this paper we make a major contribution by studying price competition for retailers with both profit and revenue targets consequently each retailer maximizes her profit and revenue probability namely the probability of achieving the profit and revenue targets simultaneously more specifically we analyze a scenario where two competing retailers purchase a perishable product from a common supplier and sell to a common market employing the isoelastic demand model we derive the closed form solutions of the optimal order quantity the optimal selling price and the maximal profit and revenue probability for each retailer it is shown that when revenue is a relevant performance measure positive and non positive salvage values lead to different optima for competing retailers moreover as price elasticity and or price competition intensity becomes higher the optimal retail price decreases and the optimal order quantity increases for each retailer

robust inventory decision under distribution uncertainty a cvar based optimization approach abstract we study the robust inventory decision making problem faced by risk averse managers with incomplete demand information in a newsvendor setting three basic models are developed expected profit maximization cvar based profit maximization and a combination of the two each model is robustly formulated under the assumption of ellipsoid discrete distribution and again under the box discrete distribution each robust model can be mathematically transformed into a second order cone program for ellipsoid uncertainty or into a general convex optimization problem for box uncertainty both transformed problems can be optimally solved directly we offer propositions with proof to show the equivalence of the transformed problems with the original ones numerical examples are given to validate the proposed approach we find that the performances under both ellipsoid and box uncertain distributions are robust finally sensitivity analysis with respect to risk averse levels and trade off coefficients is conducted to validate the proposed models and solution approaches

risk aversion in inventory management traditional inventory models focus on risk neutral decision makers i e characterizing replenishment strategies that maximize expected total profit or equivalently minimize expected total cost over a planning horizon in this paper we propose a framework for incorporating risk aversion in multiperiod inventory models as well as multiperiod models that coordinate inventory and pricing strategies we show that the structure of the optimal policy for a decision maker with exponential utility functions is almost identical to the structure of the optimal risk neutral inventory and pricing policies these structural results are extended to models in which the decision maker has access to a partially complete financial market and can hedge its operational risk through trading financial securities computational results demonstrate that the optimal policy is relatively insensitive to small changes in the decision maker s level of risk aversion

risk preferences of a newsvendor with service and loss constraints abstract using the newsvendor framework we present an approach to determine an order quantity which is relevant for the observed ordering behavior of an inventory manager whereas in literature just one constraint has been used we suggest two conflicting constraints the service constraint specified by a target value for the cycle service level is fulfilled by high order quantities the loss constraint is characterized by a target resulting in losses is met by low order quantities choosing as objective function a mean deviation rule where risk attitudes are measured by the conditional value at risk the optimal order quantity is determined depending on the risk parameters if the newsvendor is not able to specify the risk preferences we use the constraints to describe the risk attitudes of the decision maker in dependence of the profitability of the product and its demand distribution including those products where no admissible order quantity exists if there are admissible solutions we identify conditions such that the service constraint is dominating i e the prescribed service level is high and necessarily risk taking behavior is implied contrary if the loss constraint dominates i e the probability of loss is low the decision maker in any case is a risk averter but if both the service target and the loss target are not too challenging then for products with high profitability all risk preferences are possible

stocking retail assortments under dynamic consumer substitution we analyze a single period stochastic inventory model newsboy like model in which a sequence of heterogeneous customers dynamically substitute among product variants within a retail assortment when inventory is depleted the customer choice decisions are based on a natural and classical utility maximization criterion faced with such substitution behavior the retailer must choose initial inventory levels for the assortment to maximize expected profits using a sample path analysis we analyze structural properties of the expected profit function we show that under very general assumptions on the demand process total sales of each product are concave in their own inventory levels and possess the so calleddecreasing differences property meaning that the marginal value of an additional unit of the given product is decreasing in the inventory levels of all other products for a continuous relaxation of the problem we then show via counterexamples that the expected profit function is in general not even quasiconcave thus global optimization may be difficult however we propose and analyze a stochastic gradient algorithm for the problem and prove that it converges to a stationary point of the expected profit function under mild conditions finally we apply the algorithm to a set of numerical examples and compare the resulting inventory decisions to those of some simpler naive heuristics the examples show that substitution effects can have a significant impact on an assortment s gross profits the examples also illustrate some systematic distortions in inventory decisions if substitution effects are ignored in particular under substitution one should stock relatively more of popular variants and relatively less of unpopular variants than a traditional newsboy analysis indicates

inventory control with an exponential utility criterion a base stock policy is shown to be optimal when a dynamic version of the news vendor model is optimized with respect to an exponential utility criterion

inventory competition and allocation in a multi channel distribution system abstract consider a supply chain involving one manufacturer and one independent retailer the manufacturer distributes her product to the end consumer through the independent retailer as well as through her direct channel each of the two channels faces a stochastic demand if one channel is out of stock a fraction of the unsatisfied customers visit the other channel which induces inventory competition between the channels under the scenario described above will the manufacturer ever undercut the retailer s order when the capacity is infinite what are the equilibria of the game how does a capacity constraint affect the equilibrium outcome what is the optimal inventory allocation strategy for the manufacturer using a game theoretic model we seek answers to the above questions both the capacitated and the infinite capacity games are considered we establish the necessary condition for a manufacturer to undercut a retailer s order and show that a manufacturer may deny the retailer of inventory even when the capacity is ample we show that there can be an equilibrium in the capacitated game where a manufacturer might not use the entire capacity and still deny a retailer inventory we also show that a mild capacity constraint may make both parties better off and thereby increase the total supply chain profit we develop a simple yet practical contract called the reverse revenue sharing contract and show that along with a fixed franchise fee this contract can coordinates our decentralized supply chain

inventory competition under dynamic consumer choice we analyze a model of inventory competition among n firms that provide competing substitutable goods each firm chooses initial inventory levels for their good in a single period newsboy like inventory model customers choose dynamically based on current availability so the inventory levels at one firm affect the demand of all competingfirms this creates a strategic interaction amongthe firms inventory decisions our work extends earlier work on variations of this problem by karjalainen 1992 lippman and mccardle 1997 and parlar 1988 specifically we model demand in a more realistic way as a stochastic sequence of heterogeneous consumers who choose dynamically from amongthe available goods or choose not to purchase based on a utility maximization criterion we also use a sample path analysis so minimal assumptions are imposed on this demand process we characterize the nash equilibrium of the resulting stocking game and prove it is unique in the symmetric case we show there is a bias toward overstocking caused by competition specifically reducing the quantity stocked at any equilibrium of the game increases total system profits and at any joint optimal set of stocking levels each firm has an individual incentive to increase its own stock for the symmetric case we show that as the number of competing firms increases the overstockingbecomes so severe that total system and individual firm profits approach zero finally we propose a stochastic gradient algorithm for computing equilibria and provide several numerical examples

trade reform with quotas partial rent retention and tariffs quotas are the predominant means of protection in developed countries with quota rents commonly shared between exporter and importer this paper derives shadow prices appropriate to evaluating trade reform under these circumstances and provides a number of useful sufficient conditions for welfare improving piecemeal reform in doing so the authors apply the distorted quantity constrained expenditure function and use implicit separability to derive more powerful results than have previously been available

on the effects of entry in cournot markets in the framework of symmetric cournot oligopoly this paper provides two minimal sets of assumptions on the demand and cost functions that imply respectively that as the number of firms increases the minimal and maximal equilibria lead to i decreasing industry price and increasing or decreasing per firm output and ii increasing industry price and decreasing per firm output in both cases per firm profits are decreasing the analysis relies crucially on lattice theoretic methods and yields general unambiguous and easily interpretable conclusions of a global nature as a byproduct of independent interest new insight into existence of cournot equilibrium is developed

inventory pooling with environmental constraints using copulas abstract pooling is a best practice in inventory management for economic objectives in this paper we investigate whether pooling stays advantageous if environmental sustainability is considered in addition to the economic performance i e we analyze whether pooling could have a negative impact on the environment and evaluate the resulting trade off between economic and environmental performance within the newsvendor framework we consider three pooling models pooling via centralized ordering physical centralization including inventory allocation to the retailers with priority allocation and transshipments in addition we include environmental constraints based on carbon emissions covering all manufacturing and logistics operations of the product we characterize the optimal policy of the pooling models with emission constraints make a detailed comparison between the models and compare them to the decentralized i e no pooling case using copulas to model the joint distribution of dependent demands we prove that the profit decreases with increasing demand dependence further if the environmental constraint is binding optimal inventory level and emissions decrease with increasing demand dependence and pooling harms the environment compared to the case of no pooling additionally we numerically evaluate the impact of copulas and characterize when the economic and environmental performance of pooling can be balanced

effects of higher order moments on the newsvendor problem abstract in this paper we propose a stochastic programming model for the well known single period newsvendor problem by adopting the conditional value at risk cvar as the risk metric in the objective function the demand uncertainty is modeled in terms of discrete scenarios that reflect the empirical distributions implied by market demand data our numerical results demonstrate that the higher order moments skewness and kurtosis of demand have obvious effects on the newsvendor problem and the stochastic programming framework provides a flexible and effective decision support tool for the newsvendor problem

learning to compete in a transition economy experience environment and performance does organizational learning as measured by experience in a host country affect international expansion performance if so does such a relationship between experience and performance hold over time how do the environmental forces in the host country affect such a relationship focusing on organizational learning by multinational enterprises mnes operating in a transition economy this study answers these three critical questions by exploring the relationships among experience environment and performance at the subsidiary level based on a recent survey of 108 mne subunits operating in china we find that the intensity and diversity of host country experience is an important predictor of subunit performance while the positive effect of the intensity of experience on performance diminishes over time the impact of the diversity of experience on performance remains unchanged moreover for mnes experiencing greater environmental dynamism complexity and hostility there is a stronger positive relationship between experience and performance