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Own Profits (own + profit)

Distribution by Scientific Domains
Business, Economics, Finance and Accounting50%

Selected Abstracts

Machiavellianism and Economic Opportunism

JOURNAL OF APPLIED SOCIAL PSYCHOLOGY, Issue 6 2007
Maria Sakalaki
This study explores the relationship between 2 defecting strategies based on the manipulation of information; namely, Machiavellianism and economic opportunism. There are 3 main hypotheses that were confirmed in questionnaire investigations among samples of 191 and 113 university students in Athens. Machiavellianism was positively correlated with economic opportunism, shown by a statistically highly significant positive correlation between scores on scales measuring these 2 concepts. In situations of asymmetric information where they held the advantage, high Machs adopted more opportunistic strategies, showing the greatest inclination to maximize their own profit. High Machs showed less trust in potential economic partners, whom they regarded as untrustworthy maximizers. [source]

The transshipment fund mechanism: Coordinating the decentralized multilocation transshipment problem

NAVAL RESEARCH LOGISTICS: AN INTERNATIONAL JOURNAL, Issue 4 2010
Eran Hanany
Abstract The multilocation replenishment and transshipment problem is concerned with several retailers facing random demand for the same item at distinct markets, that may use transshipments to eliminate excess inventory/shortages after demand realization. When the system is decentralized so that each retailer operates to maximize their own profit, there are incentive problems that prevent coordination. These problems arise even with two retailers who may pay each other for transshipped units. We propose a new mechanism based on a transshipment fund, which is the first to coordinate the system, in a fully noncooperative setting, for all instances of two retailers as well as all instances of any number of retailers. Moreover, our mechanism strongly coordinates the system, i.e., achieves coordination as the unique equilibrium. The computation and information requirements of this mechanism are realistic and relatively modest. We also present necessary and sufficient conditions for coordination and prove they are always satisfied with our mechanism. Numerical examples illustrate some of the properties underlying this mechanism for two retailers. © 2010 Wiley Periodicals, Inc. Naval Research Logistics, 2010 [source]

Government and the Reverse-Holdup Problem

JOURNAL OF PUBLIC ECONOMIC THEORY, Issue 2 2007
ABRAHAM L. WICKELGREN
When the government bargains with a private firm, the firm cares about only its own profits, but the firm's profits may also enter into the government's utility function. As a result, the government will not bargain as aggressively for a low price. This can lead the government to "over pay" for quality. In contrast to the standard holdup problem, this reverse-holdup problem can give the firm an incentive to overinvest in non-contractible quality. The paper also discusses some examples where the reverse-holdup problem may explain excessive quality in government procurement. [source]

Supply Chain Coordination in a Market with Customer Service Competition

PRODUCTION AND OPERATIONS MANAGEMENT, Issue 1 2004
Tamer Boyaci
We consider a market with two competing supply chains, each consisting of one wholesaler and one retailer. We assume that the business environment forces supply chains to charge similar prices and to compete strictly on the basis of customer service. We model customer service competition using game-theoretical concepts. We consider three competition scenarios between the supply chains. In the uncoordinated scenario, individual members of both supply chains maximize their own profits by individually selecting their service and inventory policies. In the coordinated scenario, wholesalers and retailers of each supply chain coordinate their service and inventory policy decisions to maximize supply chain profits. In the hybrid scenario, competition is between one coordinated and one uncoordinated supply chain. We discuss the derivation of the equilibrium service strategies, resulting inventory policies, and profits for each scenario, and compare the equilibria in a numerical study. We find that coordination is a dominant strategy for both supply chains, but as in the prisoner's dilemma, both supply chains are often worse off under the coordinated scenario relative to the uncoordinated scenario. The consumers are the only guaranteed beneficiaries of coordination. [source]

Experts' agency problems: evidence from the prescription drug market in Japan

THE RAND JOURNAL OF ECONOMICS, Issue 3 2007
Toshiaki Iizuka
This article examines the physician-patient agency relationship in the context of the prescription drug market in Japan. In this market, physicians often both prescribe and dispense drugs and can pocket profits in so doing. A concern is that, due to the incentive created by the markup, physicians' prescription decisions may be distorted. Empirical results using anti-hypertensive drugs suggest that physicians' prescription choices are influenced by the markup. However, physicians are also sensitive to the patient's out-of-pocket costs. Overall, although the markup affects prescription choices, physicians appear more responsive to the patient's out-of-pocket costs than their own profits from markup. [source]

DEFECTING FROM R&D COOPERATION

AUSTRALIAN ECONOMIC PAPERS, Issue 3 2006
GAMAL ATALLAH
This paper introduces defection into the strategic R&D model. In defecting, a firm cheats by choosing its R&D expenditures to maximise its own profits, instead of maximising the joint profits of the cooperating firms. Two cooperative environments are considered: R&D cartelisation, where firms coordinate R&D activities; and RJV cartelisation, where firms coordinate R&D activities and share information. Under R&D cartelisation, defection entails an increase (decrease) in R&D and effective spillovers for low (high) spillovers; whereas under RJV cartelisation, defection always entails a decrease in R&D and effective spillovers. Under R&D cartelisation, consumer surplus and total welfare increase (decrease) with defection when spillovers are low (high). Whereas consumer surplus and welfare always decrease with defection under RJV cartelisation. Under R&D cartelisation, the incentives for defection first decrease then increase with spillovers; they also increase with the size of the market, but decline with production costs and R&D costs. Moreover, the incentives for defection are higher under RJV cartelisation. With low spillovers under RJV cartelisation, a firm prefers to be subject to defection by the other firm, to not cooperating at all. Punishment for defection is considered, under the form of abstaining from information sharing. [source]