The common wisdom is that a retailer suffers when its wholesale supplier encroaches on the retailer's operations by selling directly to final consumers. We demonstrate can benefit from encroachment even admits no synergies and does not facilitate product differentiation or price discrimination. benefits because induces encroaching reduce in order diminish unduly demand for manufacturer's product. lower increased downstream competition mitigate double marginalization problems promote...

SYNOPSIS: The push for increased transparency in financial reporting and corporate governance serves shareholders only up to a point. problem of assessing the value is subtle because both level pattern earnings can convey information. Even when management conceals information, it be beneficial shareholders. Distinguishing between ex ante post efficiency underscores advantages achieving balance privacy corporations.

Firms routinely decide whether to make essential inputs themselves or buy the from independent suppliers. Conventional wisdom suggests that a firm will not an input for price above its in-house cost of production. We show this is necessarily case when monopolistic supplier also serves firm's retail rival. In case, decision (and thus become one supplier's customers) can limit incentive would otherwise have provide on particularly favorable terms Thus, competitor may pay premium outsource...

The use of government incentives tied to market prices as means boosting corporate social responsibility (CSR) has expanded notably in recent decades. Enhanced business tax deductions for charitable donations and credits conservation easements are notable cases. While providing socially desirable behavior achieve legislative goals intuitive appeal, the broader economic consequences not always fully understood. In this study, we examine such wider supply chains when subsidies CSR offered. One...

Manufacturer-to-consumer rebates are a staple of modern supply chains. Such typically viewed as means price discrimination because partial redemption by consumers. However, the proliferation universally redeemed instant suggests practice may be motivated additional considerations, an issue we tackle in this paper. Our results demonstrate that consumer can particularly useful when chain encounters inefficiencies stemming from strategic inventory buildup retailers. Wary high wholesale prices,...

Recent years have seen a drastic transformation in the organization of wholesale and retail markets. Where once clear distinctions between suppliers competitors existed, now an era blurring boundaries has emerged. This been marked by introduction online channels for to provide products directly consumers while, at same time, traditional retailers too persist. Thus, are both customers many manufacturers. The consequences rapid emergence instances such partial forward integration not yet fully...

There are many circumstances in which manufacturers provide inputs to wholesale customers only subsequently compete with these the retail realm. Such dual distribution arrangements commonly suffer from excessive encroachment that manufacturer's ex post aggression is harmful ante because it undercuts potential profits. This paper demonstrates distribution, a manufacturer can benefit decentralized control and use of transfer prices above marginal cost. Although often create coordination...

The seminal “unraveling” result in the disclosure literature posits that discretion inevitably leads to full disclosure, even when such has detrimental consequences. In this paper, we revisit optimal of proprietary information firms compete multiple markets. analysis demonstrates presence segments, unraveling applies at firmwide level but not necessarily segment by segment. Instead, firm an ex ante desire withhold and segments are sufficiently similar, post equilibrium entails aggregation...

The centralization versus decentralization choice is perhaps the quintessential organizational structure decision. In operations realm, this particularly critical when it comes to procurement function. Why firms may opt decentralize has been often studied and confirmed be a multifaceted choice. This paper complements existing studies by detailing trade-offs in decision light of firms' strategic use inventories influence supplier pricing. particular, we demonstrate that firm's cede choices...

Minimizing strife through vertical integration is commonly seen as the “holy grail” for long-term success in product distribution. In this paper, we take a different slant, showing that sometimes separated channel embodies degree of discord can be helpful, particularly when view taken. This result shown context durable goods manufacturing. The quandary production once demand certain time frame met, there subsequent temptation to flood market with additional goods. As such, consumers are...

ABSTRACT Organizations with a mission that extends “beyond profit” to achieve broader objectives are becoming increasingly common. This paper studies such hybrid entities—firms value the profits they generate, as well utility provide customers—and details their implications for industry disclosure practices. The findings demonstrate incentives perturbed not just from being entity, but also competing entities. Accounting both competitive and effects, then assesses circumstances under which...

This paper examines how the composition of managerial teams influences information and competitive landscapes in which firms operate. Specifically, impact depends on task environment under they operate extent competition firm faces product markets. Under a substitute environment, team heterogeneity better facilitates learning, whereas, complementary homogeneity enhances learning. However, more learning is not always optimal, as this accentuates adverse selection concerns, leads firm’s rival...

In this article, we explore the connection between information system design and incentives for project search. The choice of an affects level managerial slack that is generated during implementation. Whether beneficial or costly to organization has been subject debate. our model hold-up problem in capital budgeting, there are both costs benefits having slack. cost consumption perquisites by manager. benefit it can serve as a motivational tool. possibility increasing his may encourage...