Krishnan, Harish; Kapuscinski, Roman; Butz, David A. - In: Management Science 50 (2004) 1, pp. 48-63
In this paper, a risk-neutral manufacturer sells a single product to a risk-neutral retailer. The retailer chooses inventories ex ante and promotional effort ex post. If the wholesale price exceeds marginal production cost, the retailer orders fewer than the joint profit-maximizing inventories....