Abstract
There are potential opportunistic risks in the partnerships of enterprises in different industries. Asymmetric information, incomplete decision-making and Human bounded rationality are factors for the formation of opportunistic risks, and adopting external governance is a feasible way to defuse the risks. Supply chain governance is a new type of governance which is different from enterprise governance. Its scope of governance is wider than enterprise governance. It is the performance of environmental evolution and organizational innovation. Based on the incomplete contract, this paper analyzes the game between the supplier and the manufacturer. It is found that in the process of the game, the cooperation benefits of both parties are the largest and the distribution of benefits is the fairest. Therefore, combined with the theory of supply chain governance, this paper hopes to maximize the value of supply chain by optimizing the supply chain governance strategy under the condition of incomplete contract.
Highlights
Edgeworth (1897) described the Pareto optimal short-term contract portfolio under the Walrasian general equilibrium by Edgeworth model in his pure theory of monopoly
In the process of enterprise cooperation, the information asymmetry makes the status of enterprises in the supply chain differences, so enterprises need to strengthen the management of supply chain partners through effective governance means
Based on incomplete contract theory and supply chain governance theory, this paper analyzes the game problem of twoechelon supply chain composed of suppliers and manufacturers
Summary
Edgeworth (1897) described the Pareto optimal short-term contract portfolio under the Walrasian general equilibrium by Edgeworth model in his pure theory of monopoly. No matter whether the uncertainty is introduced or not, the information between the parties analyzed by the model is symmetrical Once it is divorced from the assumption of perfect market, such as under asymmetric information, the long-term contract may not be reached. The supply chain starts with the suppliers providing raw materials, the manufacturers making intermediate products, and the products are sent to the consumers through the distributors. In this process, the enterprises bring their upstream and downstream partners into a cooperation chain by controlling the information flow, logistics and capital flow. Based on incomplete contract theory and supply chain governance theory, this paper analyzes the game problem of twoechelon supply chain composed of suppliers and manufacturers
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