Title

:

Information Sharing under Supply Chain Competition and Imperfect Demand Signal

Speaker

:

Dr. Shilu Tong

Date

:

March 20th, 2008 (Thursday)

Time

:

4:30 p.m. - 5:30 p.m.

Venue

:

Room 513

William M.W. Mong Engineering Building

(Engineering Building Complex Phase 2)

CUHK

We consider the problem of vertical information sharing in supply chains under Cournot competition and production diseconomies of scale. The problem is studied using a model of two competing supply chains, each consists of one manufacturer selling to one retailer. Each retailer observes a private imperfect demand signal about the market and decides whether to share it with the manufacturer of his own chain. Both manufacturers face diseconomies of scale in production. A multi-stage game is formulated to analyze how the firms make information sharing, contracting and retail quantity decisions. We analyze the effect of signal precision and information sharing on the performance of the firms as well as the supply chains. Our results show that it is more likely for a supply chain to have incentive for information sharing when the diseconomies of scale in production are higher, the signal precision of either supply chain is lower or the products are less similar. We extend some of our results to the case of more than two supply chains. We also consider the case of Bertrand competition with linear production cost and show that it is more likely for a supply chain to have incentive for information sharing when the signal precision of either supply chain is higher or the product are more similar.

This is joint work with Albert Ha and Hongtao Zhang.

Shilu Tong is a postdoctoral fellow in the Department of Information and Systems Management at the Hong Kong University of Science and Technology. His research interests focus on the issues of contracting, information sharing and competition in supply chain management. He received his Ph.D. degree from the Hong Kong University of Science and Technology and his B.S. and M.S. degrees from Fudan University.

Host

:

Prof. Chen Nan

Tel

:

(852) 2609-8237

Email

:

nchen@se.cuhk.edu.hk

Enquiries

:

Prof. Nan Chen or Prof. Sean X. Zhou

:

Department of Systems Engineering and Engineering Management

CUHK

Website

:

http://www.se.cuhk.edu.hk/~seg5810

Email

:

seg5810@se.cuhk.edu.hk