Strategic Investments, Trading, and Pricing Under Forecast Updating
Management Science
Stable Farsighted Coalitions in Competitive Markets
Management Science
Strategic Investments, Trading, and Pricing Under Forecast Updating
Management Science
Cost Allocation for Joint Replenishment Models
Operations Research
A Stochastic Programming Duality Approach to Inventory Centralization Games
Operations Research
Inventory Centralization Games with Price-Dependent Demand and Quantity Discount
Operations Research
Transshipment of Inventories: Dual Allocations vs. Transshipment Prices
Manufacturing & Service Operations Management
Transshipment prices and pair-wise stability in coordinating the decentralized transshipment problem
Proceedings of the Behavioral and Quantitative Game Theory: Conference on Future Directions
Cooperation in Service Systems
Operations Research
Centralizing Inventory in Supply Chains by Using Shapley Value to Allocate the Profits
Manufacturing & Service Operations Management
Incentives for Transshipment in a Supply Chain with Decentralized Retailers
Manufacturing & Service Operations Management
The equivalence of uniform and Shapley value-based cost allocations in a specific game
Operations Research Letters
A general framework for cooperation under uncertainty
Operations Research Letters
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We present and study a three-stage model of a decentralized distribution system consisting ofn retailers, each of whom faces a stochastic demand for an identical product. In the first stage, before the demand is realized, each retailer independently orders her initial inventory. In the second stage, after the demand is realized, each retailer decides how much of her residual supply/demand she wants to share with the other retailers. In the third stage, residual inventories are transshipped to meet residual demands, and an additional profit is allocated. Our model is an extension of the two-stage model of Anupindi et al. (ABZ) (2001), which implicitly assumes that all residuals enter the transshipment stage. We show, however, that allocation rules in the third stage based on dual solutions, which were used in the ABZ model, may induce the retailers to hold back some of their residual supply/demand. In general, we study the effect of implementing various allocations rules in the third stage on the values of the residual supply/demand the retailers are willing to share with others in the second stage, and the trade-off involved in achieving an optimal solution for the corresponding centralized system.