| Article ID: | iaor20121918 |
| Volume: | 40 |
| Issue: | 2 |
| Start Page Number: | 123 |
| End Page Number: | 127 |
| Publication Date: | Mar 2012 |
| Journal: | Operations Research Letters |
| Authors: | Yang Hangjun |
| Keywords: | simulation: applications |
With strategic customers, we find that a decentralized channel may have higher profit than that of a centralized channel. We show that in addition to the double marginalization effect, both customer and firm discounting and retailer competition are also driving factors of the higher decentralized channel profit.