Highlight Investigate the effect of overconfidence on a capital-constrained supply chain. Pareto region that entices both parties to participate FBP instead of FBR. Slight overconfidence can weaken the platform’s bargaining power. Severe overconfidence may be exploited by the platform to seize more profit.

    Abstract We investigate the effect of overconfidence on a capital-constrained supply chain under platform finance (PF), in which the e-commerce retailer (e-tailer) sells products and pursues a financing strategy through a platform. The e-tailer’s overconfident behavior is gauged by a cognitive bias in the estimation of demand variance. We develop Stackelberg games under two PF schemes: fulfillment by platform (FBP) and by e-commerce retailer (FBR). We find that overconfidence influences participants’ decisions and performance. Slight overconfidence weakens the platform’s bargaining power since the e-tailer will make conservative order decision and the platform will cut the interest rate. Severe overconfidence may be exploited by the platform since the e-tailer performs insensitive to the interest rate. We find there exists a Pareto region that entices both parties to participate in FBP.


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    Titel :

    Ordering and interest rate strategies in platform finance with an overconfident and commerce retailer


    Beteiligte:
    Liu, Jie (Autor:in) / Yang, Yang (Autor:in) / Yu, Yugang (Autor:in)


    Erscheinungsdatum :

    2021-07-24




    Medientyp :

    Aufsatz (Zeitschrift)


    Format :

    Elektronische Ressource


    Sprache :

    Englisch





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