Mathematics Colloquium: Masoud Talebian
Topic: Oligopolistic Contracting: Channel Coordination under Competition
We study contracts between a single retailer and multiple suppliers of two substitutable products. Suppliers have fixed capacities and present the retailer with cost contracts for their supplies. After observing the contracts, the retailer decides how much capacity to purchase from each supplier, in order to maximize profits from the aggregate capacity purchased from the suppliers and his own endowment. This is modeled as a non-cooperative, non-zero-sum game, where suppliers, or principals, move simultaneously as leaders and the retailer, the common agent, is the sole follower. We are interested in the form of the contracts in equilibrium, their effect on the total supply chain profit, and how the profit is split between the suppliers and the retailer. Under mild assumptions, we characterize the set of all equilibrium contracts, and discuss all-unit and marginal-unit quantity discounts as special cases. We also show that the supply chain is coordinated in equilibrium with a unique profit split between the retailer and the suppliers, where each supplier's profit is equal to the marginal contribution of her capacity to supply chain profits. The retailer's profit is equal to the total revenue collected from the market minus the payments to the suppliers and the associated sales costs.
About the speaker
Dr. Masoud Talebian - The University of Newcastle and Sharif University of Technology
Dr. Masoud Talebian received his PhD from Columbia University. His research interest is in applying innovative operational research models in the broad areas of marketing and operations. He has published several papers in prestigious journals in his areas of expertise. Dr. Talebian has been the recipient of industrial grants as well as research prizes. He also has several professional experiences both in the USA and Australia.