"A Cooperative Game-Theory Model for Quantity Discounts"
©
Management Science,
June
1989
Volume: 35
|
Issue: 5
|
Pages: 693-70
Publication type: Journal article
Research Archive Topic: Business Economics and Public Policy, Marketing, Operations
Abstract
Quantity discounts offered by a monopolist are considered in the context of a bargaining problem in which the buyer and seller negotiate over the order quantity and the average unit price. All-units and incremental quantity discounts that permit transactions at a negotiated outcome are described. The effect of risk sensitivity and bargaining power on quantity discounts are discussed for alternative bargaining models.
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