The Delivery and Control of Quality in Supplier-Producer Contracts
AbstractWe model the effect of contract parameters such as price rebates and after-sales warranty costs on the choice of quality by a supplier, the inspection policy of a producer, and the resulting end product quality. Both noncooperative and cooperative settings are explored. The paper's contribution is to highlight the importance of strategic and contractual issues in quality management.
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Bibliographic InfoArticle provided by INFORMS in its journal Management Science.
Volume (Year): 41 (1995)
Issue (Month): 10 (October)
quality control; inspection; game theory;
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