A manufacturer supplies a retailer who has private superior knowledge about three system parameters; namely, market size, market sensitivity, and her retail-processing cost. For each parameter, the manufacturer's imperfect knowledge is characterized by a subjective distribution. Should the...

A "manufacturer" supplies a "staple" product to a large number of "retailers" having very different sales volumes. Many models have considered how the "manufacturer" should design a quantity-discount (QD) scheme to induce the retailers to order in larger batch sizes. Our models differ from most...