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Collaborative Shipping Under Information Distortion

Conference paper
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Part of the Lecture Notes in Business Information Processing book series (LNBIP, volume 262)

Abstract

We examine the incentives for a firm to provide non-truthful demand information under a two-company shipping collaboration. We analyze how distorted demand reporting impacts the logistics costs of each individual company in the collaboration and how this impacts the stability of the collaboration agreement. We find that when the cost allocation proportions are agreed ex-ante based on the reported demand, companies have an incentive to deflate their demand when simple cost allocation rules are used; only when the Shapley value is in place, companies have no incentive to distort their demand information. When the cost allocation proportions are calculated ex-post, based on realized demand, the truth-telling strategy is dominant when the Shapley value or an allocation rule based on the demand or stand-alone costs is in place.

Keywords

Collaborative Shipping Stand-alone Cost Shapley Value Cost Allocation Coalition Cost 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

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Copyright information

© Springer International Publishing AG 2018

Authors and Affiliations

  1. 1.Research Center for Operations Management, Faculty of Business and EconomicsKU LeuvenLeuvenBelgium
  2. 2.Department of Information, Logistics and Innovation, School of Business and EconomicsVU University AmsterdamAmsterdamThe Netherlands
  3. 3.Technology and Operations Management AreaVlerick Business SchoolGhentBelgium

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