Comment on 'Strategic Information Management Under Leakage in a Supply Chain'

Management Science, 2016, Forthcoming

10 Pages Posted: 9 Sep 2016 Last revised: 15 Sep 2016

See all articles by Lin Tian

Lin Tian

Fudan University, School of Management

Baojun Jiang

Washington University in Saint Louis - John M. Olin Business School

Date Written: April 22, 2016

Abstract

Anand and Goyal (2009) propose a horizontal differentiation model to study information leakage and demand signaling in a supply chain. The authors present a composite equilibrium consisting of separating and pooling outcomes in different parameter regions and claim that it satisfies the Intuitive Criterion. We show that their analysis for the pooling equilibrium has errors and also that all pooling outcomes are actually eliminated by the Intuitive Criterion. The positive note is that if the undefeated equilibrium or lexicographical maximum sequential equilibrium (LMSE) refinement is adopted, a similar composite equilibrium will be achieved, which will lead to qualitatively the same results as in the original paper.

Keywords: signaling, demand uncertainty, intuitive criterion, supply chain and logistics, lexicographical maximum sequential equilibrium

Suggested Citation

Tian, Lin and Jiang, Baojun, Comment on 'Strategic Information Management Under Leakage in a Supply Chain' (April 22, 2016). Management Science, 2016, Forthcoming. Available at SSRN: https://ssrn.com/abstract=2835835 or http://dx.doi.org/10.2139/ssrn.2835835

Lin Tian

Fudan University, School of Management ( email )

670 Guoshun Road, Yangpu District
Shanghai, 200433
China

Baojun Jiang (Contact Author)

Washington University in Saint Louis - John M. Olin Business School ( email )

One Brookings Drive
Campus Box 1156
St. Louis, MO 63130-4899
United States
3149353315 (Phone)

HOME PAGE: http://apps.olin.wustl.edu/faculty/Jiang/

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