We consider a newsvendor problem with price-dependent demand,in either additive or multiplicative format.The newsvendor has two modes of purchasing:regular ordering at the beginning of the selling season and emergency ordering(if the realized demand exceeds the initial order quantity) at the end of the selling season.By stochastic comparisons,we systematically investigate the effects of demand magnitude and demand randomness on pricing and ordering quantity decisions as well as expected profit of the newsvendor,under both usual stochastic order(first order stochastic dominance) and convex order(less variable).Our key findings include:(i) in contrary to the case where price is exogenous,a stochastically larger demand shock may even lead to a lower order quantity;(ii) a stochastically larger demand shock leads to a higher price for the additive demand case,but may lead to a lower price for the multiplicative demand case;(iii) a stochastically larger demand shock leads to a higher expected profit for both demand models;(iv) in general,a less variable demand leads to a higher expected profit for both demand models;and furthermore,a less variable demand shock has no effect on price for the additive demand model,but leads to a higher price for the multiplicative demand model.The implications of all these findings for pricing and order quantity are discussed in detail.
In this paper,we consider a newsvendor model in which a risk-averse manager faces a stochastic price-dependent demand in either an additive or a multiplicative form.An emergency purchase option is allowed after the realization of demand to satisfy the units that are short.By adopting conditional value-at-risk(CVaR) as the decision criterion,we aim to investigate the optimal pricing and ordering decisions,and the effects of parameter changes in such a setting.We provide sufficient conditions for the uniqueness of the optimal policy for both demand models.We perform comparative statics analysis to show how the optimal pricing and ordering decision behaves when changing parameters.We also compare our results with those of the newsvendor with a general utility function and with CVaR criterion under lost sales assumption.Our key results include:(i) For both demand models,the optimal selling price is decreasing in risk aversion.Hence,the optimal price of a risk-averse newsvendor is not greater than the optimal price of a risk-neutral newsvendor.(ii) In contrary to the lost sales case,for the multiplicative demand model,the optimal order quantity may not be monotonic in risk aversion. Consequently,the optimal risk-averse order quantity may be lower or higher than the optimal risk-neutral counterpart.(iii) For the additive model,the optimal order quantity is strictly increasing in the emergency purchase price,while for the multiplicative model the optimal order quantity has no such a monotonic property.Some numerical examples are conducted to verify our claims and gain more insights about the risk-averse decision-making behaviors.
Minghui XU School of Economics and Management,Wuhan University,Wuhan 430072,China
This paper investigates the influence of low-carbon policies on channel coordination for a two-echelon supply chain consisting of one supplier and one retailer.Four different models are considered:the basic model,the carbon emission model,the carbon emission trading model and the carbon tax model.We find that the government policy on all carbon emission models is not universal among the firms as well as the customers.The carbon emission trading policy is always better than the carbon emission policy and the carbon tax policy when the allocated carbon emission quotas are greater than the carbon emissions.The carbon emission trading policy is proved to be an effective mechanism which can motivate the supply chain to reduce carbon emissions.Under certain conditions,the supply chain prefers the carbon emission trading policy with higher carbon price to other policies.In the framework of Stackelberg game with the supplier as the leader,for each carbon policy,the paper presents coordination mechanism with the all-unit wholesale quantity discount contract(AWQD).We analyze and compare the influence of low-carbon policies on channel coordination for the four low-carbon policies.Numerical experiments are conducted to examine our findings.
