We study contracts between a single retailer and multiple suppliers of two substitutable products, where suppliers have fixed capacities and present the retailer cost contracts for their supplies. After observing the contracts, the retailer decides how much capacity to purchase from each...

In this chapter, we discuss when, how, and why trust and trustworthiness arise to support cooperation within and across organizations. To do so, we first define trust and trustworthiness, discuss how they can be quantified and determine key components of trusting and trustworthy behavior. In...

Cheap-talk communication between parties with conflicting interests is common in many business and economic settings. Two distinct behavioral economics theories, the trust-embedded model and the level-k model, have emerged to explain how cheap talk works between human decision makers. The...