In the context of supply contract design, the more powerful party has the lib-erty of withholding private information which also improves its bargaining power.Traditionally, the supplier (e.g., manufacturer) has been more powerful, and, hence,the existing literature in the area emphasizes supplier-driven contracts. However, insome current markets, such as the grocery channel, the bargaining power has shiftedto the buyer (e.g., retailer). For example, in the United States, large retailers, suchas Wal-Mart, exert tremendous market power over their suppliers. Also, with theadvent of the Internet, buyers have gained access to much more information aboutmultiple potential suppliers. Hence, this dissertation takes into account the recenttrends in power shifting between suppliers and buyers, and it attempts to provide acomparison of optimal supply contract designs in supplier- versus buyer-driven chan-nels. This research is unique in that we explore the impact of both power shiftingand information asymmetry while designing optimal supply chain contracts undersupply uncertainty and competition. Placing an emphasis on the cases of stochasticand/or price-sensitive demand, we work on several novel problems in stochastic mod-eling, nonlinear and dynamic optimization, and game theory. Hence, this researchhas roots in applied probability, optimization, inventory theory, game theory, and eco-nomics. The goal is to advance our practical knowledge of designing implementablecontracts because such knowledge is crucial for optimizing supply chain performance in the real world. This dissertation provides insights about* the individual and joint impacts of the power structure and information asym-metry on supply chain performance,* the value of information for contract design in supplier- versus buyer-drivenchannels,* the impact of supply uncertainty and supplier competition on contract designin supplier- versus buyer-driven channels.
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