E the tension between theory and practice regarding complexity and performance in contract design is especially relevant. The goal of this paper is to understand why simpler contracts may commonly be preferred in practice despite being theoretically suboptimal. We study a two-tier supply chain with a single supplier and a single buyer to characterize the impact of contract complexity and asymme...

Purpose – The purpose of this paper is to investigate performance outcomes of strategic sourcing, specifically examining how strategic sourcing affects buyer‐supplier relationship, supplier evaluation, and sourcing performance from the buying firm's perspective in the context of the US textile and apparel industry. Design/methodology/approach – This study provides an empirical investigation of ...

Online stores like Amazon and Ebay are growing by the day. Fewer people go to departmental stores as opposed to the convenience of purchasing from stores online. These stores may employ a number of techniques to advertise and recommend the appropriate product to the appropriate buyer profile. This article evaluates various 3-node and 4-node motifs occurring in such networks. Community structure...

The Internet-driven electronic marketplace has been presented as a mean of enhancing collaboration between buyers and suppliers while generating significant advantages for both parties. Nevertheless, the introduction of online reverse auctions (ORA) in the negotiation process has been perceived as a resource that decreases inter-organizational trust, limiting the possibilities of collaboration....

When the seller of an asset grants a right-of-first-refusal to a buyer, this special buyer has the opportunity to purchase the asset at the best price the seller can obtain from the other potential buyers. We show that the right-of-first-refusal is inefficient, and it benefits the special buyer at the expense of the seller and other buyers. In a private values model, the benefit from granting a...

In this paper, several seller–buyer supply chain models are proposed which incorporate both cost factors as well as elements of competition and cooperation between seller and buyer. We assume that unit marketing expenditure and unit price charged by the buyer influence the demand of the product being sold. The relationships between seller and buyer will be modeled by non-cooperative and coopera...

Geographically dispersed sellers in electronic reverse-marketplaces such as those hosted by Freemarkets are uncertain about the number of competitors they face in any given market-session. Over the course of several market-sessions they learn about the competitive nature of the marketplace. How sellers learn to reduce the market-structure uncertainty depends on the market-transparency scheme, o...

Evidence shows that suppliers refrain from investing in energy efficiency (EE) measures because they fear that a buyer with greater bargaining power will use the EE-related cost reductions to push prices down, in the purchase bargaining process, and thereby further reduce the supplier’s profit margin. Suppliers are also discouraged from EE investment by the uncertainty associated with new techn...

There is a seller who has an object to sell to a single buyer. The seller’s value for the object is c. The buyer’s valuation, v, is distributed according to the CDF F supported on (−∞, 1]. Let μ denote the expected valuation, that is, ∫ 1 0 vdF (v) = μ. The buyer observes a signal s about v. The joint distribution of v and s is common knowledge. The seller then gives a take-it-or-leave-it price...