Optimal Management of Supply Disruptions when Contracting with Unreliable, Risk-averse, Suppliers

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Parlane, Sarah; Tsai, Yingyi;
  • Publisher: University College Dublin. School of Economics
  • Subject: D86 | Newsvendor optimisation | Moral hazard | M11 | Random capacity model | L24
    • ddc: ddc:330
    acm: ComputerApplications_COMPUTERSINOTHERSYSTEMS

This paper investigates the optimal management of supply disruptions by a manufacturer who uses order inflation and/or investments in process reliability when contracting two risk-averse suppliers. We consider that these investments can be subject to moral hazard. Techn... View more
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