Supplier-retailer Chain with Asymmetric Demand Information and Pessimistic Supplier

摘要

This paper considers a supplier-retailer chain problem, in which the retailer knows the distribution of the demand, while the supplier only knows the distribution interval of the demand. The supplier's objective is to optimize his competitive ratio. We find that the retailer orders more if he faces stronger market, and bears less overage risk than in the classical newsvendor problem.