Abstract
This paper suggests an improved principal-agent model for profit distribution under double moral hazard risk based on the maximum profit of the producer service outsourcing value chain in order to realize the maximum profit of both the manufacturer and contractor. Then the related profit distribution parameters are set by calculation, and relevant variables are analyzed. The results show that the optimal output share for contractor is negatively correlated to the output coefficient of manufacturer’s effort and positively correlated to the output coefficient of contactor’s effort and irrelevant to the effort and cost coefficient of the both sides, while the optimal fixed payment can be selected within a certain range decided by the agreement reached from the expected profit of the two sides, and the selection makes no difference to the profit of producer service outsourcing value chain.
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Cai, S., Qiu, L., Zou, B. (2014). Profit Distribution Based on Producer Service Outsourcing Value Chain. In: Watada, J., Xu, B., Wu, B. (eds) Innovative Management in Information and Production. Springer, New York, NY. https://doi.org/10.1007/978-1-4614-4857-0_17
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DOI: https://doi.org/10.1007/978-1-4614-4857-0_17
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