TY - JOUR
T1 - Risk sharing and inventories
AU - Spulber, Daniel F.
N1 - Funding Information:
*Research support from the National Science Foundation under Grant no. SES82-19121 is gratefully acknowledged. I thank Harrison Cheng and Gary Muller for helpful discussions and an anonymous referee for helpful comments. I thank Carl Johnson for researsh assistance. I also thank participants in the Industrial Organization Seminar at the University of California at San Diego. Any errors are my responsibility. aFor example, a survey of bookstores in Publishers Weekly indicates that 18% of hardcover and mass market paperbacks and about 14% of trade paperbacks are returned to the publishers \[see Maryles (1981)\].
PY - 1985/3
Y1 - 1985/3
N2 - The paper shows how various features of market organization, such as existence of retail chains, the centralized warehousing of inventories by wholesalers, and the arrangements whereby suppliers partially reimburse sellers for unsold inventories can be explained in terms of optimal contracts for sharing the risks of excess inventories. When retailers face heterogeneous demands, the paper demonstrates the optimality of shared inventories and obtains optimal incentive properties for the risk sharing policy.
AB - The paper shows how various features of market organization, such as existence of retail chains, the centralized warehousing of inventories by wholesalers, and the arrangements whereby suppliers partially reimburse sellers for unsold inventories can be explained in terms of optimal contracts for sharing the risks of excess inventories. When retailers face heterogeneous demands, the paper demonstrates the optimality of shared inventories and obtains optimal incentive properties for the risk sharing policy.
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U2 - 10.1016/0167-2681(85)90024-1
DO - 10.1016/0167-2681(85)90024-1
M3 - Article
AN - SCOPUS:0010032889
VL - 6
SP - 55
EP - 68
JO - Journal of Economic Behavior and Organization
JF - Journal of Economic Behavior and Organization
SN - 0167-2681
IS - 1
ER -