Large literatures in operations and economics analyze dynamic models of profit-optimizing firms. The insights and algorithms in these literatures can be adapted to maximize value if the model excludes external strategic interactions and risk of bankruptcy. The insertion of external strategic...

Problem definition: Profit maximization is the default criterion in operations management and normative economics of industrial organizations, but its pursuit achieves a firm's financial value only under stringent conditions. Otherwise: (A) Profit optimization is sub-optimal, (B) the appropriate...

The reputation of a multinational firm (a “buyer”) is hurt if its offshore supplier flagrantly violates fair labor practices. How should a buyer manage the consequent risk of reduced sales? This paper analyzes a dynamic Stackelberg game in which the buyer (the “leader”) offers financial...

Manufacturers who outsource components incur risks as well as benefits. If the supplied product has a major quality defect, the adverse effect on the manufacturer's reputation reduces its market share. This paper presents a discrete-time model of a buyer who collaborates with a sole supplier to...

We give sufficient conditions under which a policy that assigns customers to the Fastest Available Server, labelled FAS, is optimal among non-idling policies in queuing models with multiple independent Markov-modulated Poisson arrival processes and heterogeneous parallel exponential servers with...

Consider a binary relation on a real vector space of vector-valued discrete-time stochastic processes. If the binary relation satisfies four axioms, then there are unique discount factors such that preferences regarding stochastic processes induce prefences among present value random vectors....

We employ the Nash bargaining solution to determine the value of an opportunity to negotiate a contract in an archetypal supply chain game. This unifies the allocation of payoffs and the selection of the type of contract in a bilateral supply chain; a supplier delivers goods to a news vendor...