Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
6896047 | European Journal of Operational Research | 2016 | 17 Pages |
Abstract
Coordinating supply chains is an important goal for contract designers because it enables the channel members to increase their profits. Recently, many experimental studies have shown that behavioral aspects have to be taken into account when choosing the type of contract and specifying the contract parameters. In this paper, we analyze behavioral aspects of revenue-sharing contracts. We extend the classical normative decision model by incorporating reference-dependent valuation into the decision model and show how this affects inventory decisions. We conduct different lab experiments to test our model. As a result, human inventory decisions deviate from classical normative predictions, and we find evidence for reference-dependent valuation of human decision makers. We also show how contract designers can use the insights we gained to design better contracts.
Related Topics
Physical Sciences and Engineering
Computer Science
Computer Science (General)
Authors
Michael Becker-Peth, Ulrich W. Thonemann,