Incentive Compatible Mechanisms for Decentralized Supply Chain Formation

In this thesis, we describe a decentralized supply chain formation problem where the supply chain planner or a central design authority (CDA) is faced with the decision of choosing a partner or service provider at individual supply chain echelons so as to meet delivery quality levels at minimum cost. If all the relevant information is available in accurate form with the CDA, then the problem could be formulated and solved as an appropriate optimization problem. However, in the real-world, the CDA does not always have access to all the required information. The primary reason for this is the fact that typical supply chain entities (such as echelon managers and service providers) are autonomous, rational, and intelligent, and consequently exhibit strategic behavior. As a result, these entities may not reveal their true cost information; in fact, they may provide false information in the best hope of maximizing their individual utility functions. Eliciting truthful information ...

• Type: Dissertation
• Year: 2007
• Authors: Nikesh Kumar Srivastava
• Keywords: 2007, 2007, Bayesian Incentive Compatibility, D'Aspremont And Gerard-Varet Mechanisms, Dominant Strategy Incentive Compatibility, Mean Variance Allocation Problem, Supply Chain Formation Problem, Vickrey Clarke Groves Mechanisms