Algorithms are taking over decision-making in business. In this paper, we study the effects associated with algorithm aversion in a distribution channel comprising one supplier and one retailer. In this context, algorithm aversion is defined as a cognitive bias that the retailer obeys inferior...

Bandit products have captured significant market shares in China and have started to expand throughout the world. A striking feature of supply chains for bandit products is decentralization, where the upstream firm determines the product quality and the downstream firms compete on prices. We...