This paper consider optimization decision-making of closed-loop supply chain based on revenue sharing contract and prospect theory, and study the effect of lose aversion on the performance of closed-loop supply chain. We establish a decision-making model for the closed-loop supply chain which consists a loss averse retailer and a loss averse manufacturer. Through the analysis of this model unde...

This paper develops a methodology for characterizing expected revenue from auctions when bidders’ types come from an arbitrary distribution. In particular, types may be multidimensional, and there may be mass points in the distribution. One application extends existing revenue equivalence results. Another application shows that first-price auctions yield higher expected revenue than second-pric...

We study private-value auctions with n risk-averse bidders, where n is large. We first use asymptotic analysis techniques to calculate explicit approximations of the equilibriumbids and of the seller’s revenue in any k-price auction (k = 1, 2, . . .). These explicit approximations show that in all large k-price auctions the effect of risk-aversion is O(1/n2) small. Hence, all large k-price auct...

W e consider a supply chain with a supplier that sells to a retailer under a revenue-sharing arrangement. Demand is uncertain and unobservable to the supplier. We assume that the retailer is rational, that is, the retailer behaves opportunistically and underreports sales revenues to the supplier whenever such underreporting is profitable. Assuming the supplier has the ability to audit the retai...

We present a stochastic optimization model for hotel revenue management with multipleday stays under an uncertain environment. Since a decision maker may face several scenarios when renting out rooms, we use a semi-absolute deviation model to measure the risk of hotel revenue, and only consider the risk of falling below the expected revenue. The method proposed in this paper can be changed to a...

We analyze a new auction format in which bidders pay a fee each time they increase the auction price. Bidding fees are the primary source of revenue for the seller, but produce the same expected revenue as standard auctions (assuming risk-neutral bidders). If risk-loving preferences are incorporated in the model, expected revenue increases. Our model predicts a particular distribution of ending...