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Professor Ulrich W. Thonemann, Ph.D. ,Director and Vice Dean External Relations,University of Cologne,Faculty of Management·Designing Incentive Systems for Truthful Demand Information Sharing - Theory and Experiment·2013年11月7日·北510

日期:2013-11-04

【Title】Designing Incentive Systems for Truthful Demand Information Sharing - Theory and Experiment

【Speaker】Professor Ulrich W. Thonemann, Ph.D. ,Director and Vice Dean External Relations,University of Cologne,Faculty of Management, Economics and Social Sciences,Albertus-Magnus-Platz D-50923 Cologne, Germany

【Host】Dr. Xiaobo Zhao

【Location】Shunde Bldg., Room N510

【Time】14:00 -15:00, November 07, 2013 (Thursday)

【Abstract】We consider a firm where sales is responsible for demand forecasting and operations is responsible for ordering. Sales has better information about the demand than operations and sends a non-binding demand forecast to operations. Based on the demand forecast, operations determines the order quantity. To incentivize truthful demand information sharing, we include a penalty for forecast errors in the incentive system of sales. We model the utility function of sales based on monetary elements and the behavioral factors lying aversion and loss aversion. We formalize the setting as a signaling game and derive equilibriums of the game. In a laboratory experiment, we observe human behavior that is in-line with the model predictions, but deviates substantially from expected payoff-maximizing behavior. Finally, we use the behavioral model to design incentive systems for truthful information sharing and conduct an experiment to validate the approach with out-of-sample treatments and out-of-sample subjects.