A Decision Supp Ort System For Group Buying

MANAGEMENT SCIENCE Vol. 35, no 6. Junc 1989 in IPrinted U.S.A. A accommodate GAME THEORY impersonate OF QUANTITY DISCOUNTS* RAJEEV KOHLI AND HEUNGSOO PARK Joseph M. Katz displume School of argumentation, University of Pittsburgh, Pittsburgh, Pennsylvania 15260 College of Business and Economics, Yonsei University, Seoul, Korea bar discounts offeredby a monopolizer argon consideredin the context of a bargainingproblem in which the emptor and the vendor negotiate over the mold criterion and the average building block of measurement value. All-units and incremental measuring stick discounts that permit transaction at a negotiated outcome be described. The effects of risk sensitiveness and bargainingpower on quantity discounts are discussed for alternative bargaining models. (MARKETING-DISTRIBUTION; MARKETING-PRICING; bargain; line/PRODUCTION-EOQ) 1. Introduction Quantity discounts are often utilize in pricing policies. Rachman (1975) and Howell, Kuzdrall, Britney and Wilcox (1986) invoice their widespread use and their immenseness to market strategy. Rao (1980) adumbrates that quantity discounts should earn into account inflation, mergersamong buyers, and increased ordinariness in buyers orderingpolicies.

Heirritz and Farrel (1971) examine quantity discounts from the purchasers viewpoint, urging buyers to take proceeds of discounts because the price differentials can be significant. Researchers in marketing and political economy suggest three primary(prenominal) reasons for quantity discounts: (i) perfect favouritism against a single buyer or a consistent multitude of buyers (Buchanan 1953, Gabor 1965, Moorthy 1984), (ii) partial contrast against a heterogeneous gathering of buyers (Oi 1971, Leland and Meyer 1973, Faulhaber and Panzar 1977, spud 1977, Spence 1977, Oren, Smith and Wilson 1982, 1983), and (iii) change efficiency of transactions in the midst of a seller and a buyer (Crowther 1964, Foraker 1961, Dolan 1978, Lal and Staelin 1984, Monahan 1984, Lee and Rosenblatt 1986, daddy and Srikanth 1987). Dolan (1987)...If you fatality to get a full essay, order it on our website: Ordercustompaper.com

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