Supplier Selection Model Based on Two Stage Signal Game and Reputation Mechanism

Abstract:

Asymmetric information will lead to adverse selection in the supplier selection in the supply. One the basis of game theory and information economics theories, a two stage supplier selection signal game reputation model is presented. The optimal price signal and utility of supplier are derived under symmetric and asymmetric information. The optimal signal of supplier will be strengthen and the utility at the second stage will also be increased if the supplier sets up reputation at the first stage, and it also shown that more utilities can be achieved when a supplier uses reputation.

• Periodical: Advanced Materials Research (Volume 214)
• Pages: 50-54
• DOI: https://doi.org/10.4028/www.scientific.net/AMR.214.50
• Online since: February 2011
• Authors: Xin Ma
• Keywords: Asymmetric Information, Reputation Mechanism, Signal Game, Supplier Selection, Supply Chain Management (SCM)

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