Significant evidence has emerged that consumers are boundedly rational and display a sunk cost bias when making decisions. We compare two commonly used pricing schemes, fixed fee and time-based pricing, when customers exhibit sunk cost bias in a service setting with diagnosis and treatment...

This work explores the potential of revenue sharing contracts to facilitate information sharing in a supply chain and mitigate the negative effects of information leakage. We consider a supplier who offers a revenue sharing contract to two competing retailers, one of whom has private information...

We investigate the performance of two commonly used pricing schemes -- hourly-rate contract and two-part tariff -- in service environments where the buyer's valuation is invisible to the service provider and the provider's effort may not be visible to the buyer. In the private effort...

Stable alliance structures among monopoly component-suppliers in a decentralized assembly system are somewhat well understood. However, when there are competing suppliers for any particular component, less is known about such alliances. The intent of this paper is to address some of the...

This paper analyzes the contracting of maintenance services provided by an original equipment manufacturer (OEM) to an operator for a device. The service provider can exert different levels of maintenance effort during the course of the contract and the device's reliability (uptime) is...

This paper uses a real options approach to analyze investments in process improvement. We develop a simple, stochastic model of a firm making investment decisions in process improvement. Our analysis offers several interesting insights into investments in process improvement. First, early...

Problem Definition: An on-demand service platform relies on independent workers (agents) who decide how much time, if any, to devote to the platform. Some labor advocates have argued that an expansion of the labor pool hurts agents—by reducing the wage and agent utilization (i.e., the fraction...

Online social advertising tools such as Groupon and Living Social generate new business for service providers and at the same time generate new challenges. By doing promotion, a firm may unavoidably attract deal hunters who are less likely to continue to purchase the service after promotion....

Problem Definition: We have witnessed a rapid rise of on-demand platforms, such as Uber, in the past few years. While these platforms allow workers to choose their own working hours, they have limited leverage in maintaining the availability of workers within a region. As such, platforms often...