Article ID: | iaor200948264 |
Country: | United Kingdom |
Volume: | 4 |
Issue: | 1 |
Start Page Number: | 97 |
End Page Number: | 116 |
Publication Date: | Nov 2009 |
Journal: | International Journal of Operational Research |
Authors: | Yu Haibin, Huang Xiaoyuan, Zhang Cuihua |
Keywords: | quality & reliability |
This paper is essentially concerned with the supplier and the buyer's quality control decision in supply chain with asymmetric information. The paper presents principal‐agent models regarding the buyer's quality evaluation level and the supplier's quality prevention level decision problems. The paper then focuses on the supplier and the buyer's optimisation problems being turned into optimal control problems under asymmetric information. Maximal principle is used to get the solution. And comparison analyses are made between two different information settings. At last, numerical examples are presented to prove our models and analyses.