IDEAS home Printed from https://ideas.repec.org/a/spr/mathme/v89y2019i2d10.1007_s00186-018-0645-1.html
   My bibliography  Save this article

Implementation of optimal schedules in outsourcing with identical suppliers

Author

Listed:
  • Herbert Hamers

    (Tilburg University)

  • Flip Klijn

    (CSIC
    Barcelona GSE Center
    Tilburg University)

  • Marco Slikker

    (Eindhoven University of Technology)

Abstract

This paper deals with decentralized decision-making situations in which firms outsource production orders to multiple identical suppliers. Each firm aims to minimize the sum of its completion times. We study whether a central authority can install a mechanism such that strategic interaction leads to a socially optimal schedule. For the case of single demand the shortest-first mechanism implements optimal schedules in Nash equilibrium. We show that for the general case there exists no anonymous mechanism that implements optimal schedules in correlated equilibrium.

Suggested Citation

  • Herbert Hamers & Flip Klijn & Marco Slikker, 2019. "Implementation of optimal schedules in outsourcing with identical suppliers," Mathematical Methods of Operations Research, Springer;Gesellschaft für Operations Research (GOR);Nederlands Genootschap voor Besliskunde (NGB), vol. 89(2), pages 173-187, April.
    • Handle: RePEc:spr:mathme:v:89:y:2019:i:2:d:10.1007_s00186-018-0645-1
    DOI: 10.1007/s00186-018-0645-1
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s00186-018-0645-1
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s00186-018-0645-1?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Lee, Kangbok & Leung, Joseph Y.-T. & Pinedo, Michael L., 2012. "Coordination mechanisms for parallel machine scheduling," European Journal of Operational Research, Elsevier, vol. 220(2), pages 305-313.
    2. Georgia Perakis & Guillaume Roels, 2007. "The Price of Anarchy in Supply Chains: Quantifying the Efficiency of Price-Only Contracts," Management Science, INFORMS, vol. 53(8), pages 1249-1268, August.
    3. José R. Correa & Maurice Queyranne, 2012. "Efficiency of equilibria in restricted uniform machine scheduling with total weighted completion time as social cost," Naval Research Logistics (NRL), John Wiley & Sons, vol. 59(5), pages 384-395, August.
    4. Matthew O. Jackson, 2001. "A crash course in implementation theory," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 18(4), pages 655-708.
    5. Myerson, Roger B. & Satterthwaite, Mark A., 1983. "Efficient mechanisms for bilateral trading," Journal of Economic Theory, Elsevier, vol. 29(2), pages 265-281, April.
    6. Kenneth J. Arrow, 1950. "A Difficulty in the Concept of Social Welfare," Journal of Political Economy, University of Chicago Press, vol. 58(4), pages 328-328.
    7. Wayne E. Smith, 1956. "Various optimizers for single‐stage production," Naval Research Logistics Quarterly, John Wiley & Sons, vol. 3(1‐2), pages 59-66, March.
    8. Cole, Richard & Correa, Jose & Gkatzelis, Vasillis & Mirrokni, Vahab & Olver, Neil, 2015. "Decentralized utilitarian mechanisms for scheduling games," LSE Research Online Documents on Economics 103081, London School of Economics and Political Science, LSE Library.
    9. Li, Xiuhui & Wang, Qinan, 2007. "Coordination mechanisms of supply chain systems," European Journal of Operational Research, Elsevier, vol. 179(1), pages 1-16, May.
    10. Cole, Richard & Correa, José R. & Gkatzelis, Vasilis & Mirrokni, Vahab & Olver, Neil, 2015. "Decentralized utilitarian mechanisms for scheduling games," Games and Economic Behavior, Elsevier, vol. 92(C), pages 306-326.
    11. Yossi Bukchin & Eran Hanany, 2007. "Decentralization Cost in Scheduling: A Game-Theoretic Approach," Manufacturing & Service Operations Management, INFORMS, vol. 9(3), pages 263-275, October.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Chiu, Singa Wang & Chen, Hui-Cun & Wu, Hua-Yao & Chiu, Yuan-Shyi Peter, 2020. "A hybrid finite production rate system featuring random breakdown and rework," Operations Research Perspectives, Elsevier, vol. 7(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Braat, Jac & Hamers, Herbert & Klijn, Flip & Slikker, Marco, 2019. "A selfish allocation heuristic in scheduling: Equilibrium and inefficiency bound analysis," European Journal of Operational Research, Elsevier, vol. 273(2), pages 634-645.
    2. Felipe T. Muñoz & Rodrigo Linfati, 2024. "Bounding the Price of Anarchy of Weighted Shortest Processing Time Policy on Uniform Parallel Machines," Mathematics, MDPI, vol. 12(14), pages 1-12, July.
    3. Ravindran Vijayalakshmi, Vipin & Schröder, Marc & Tamir, Tami, 2024. "Minimizing total completion time with machine-dependent priority lists," European Journal of Operational Research, Elsevier, vol. 315(3), pages 844-854.
    4. Cong Chen & Paul Giessler & Akaki Mamageishvili & Matúš Mihalák & Paolo Penna, 2024. "Sequential solutions in machine scheduling games," Journal of Scheduling, Springer, vol. 27(4), pages 363-373, August.
    5. Tami Tamir, 2023. "Cost-sharing games in real-time scheduling systems," International Journal of Game Theory, Springer;Game Theory Society, vol. 52(1), pages 273-301, March.
    6. repec:cte:werepe:we081207 is not listed on IDEAS
    7. Athreya, Kartik B., 2014. "Big Ideas in Macroeconomics: A Nontechnical View," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262019736, April.
    8. Bierbrauer, Felix & Netzer, Nick, 2016. "Mechanism design and intentions," Journal of Economic Theory, Elsevier, vol. 163(C), pages 557-603.
    9. Kovács, András & Egri, Péter & Kis, Tamás & Váncza, József, 2013. "Inventory control in supply chains: Alternative approaches to a two-stage lot-sizing problem," International Journal of Production Economics, Elsevier, vol. 143(2), pages 385-394.
    10. Flip Klijn & Marc Vorsatz, 2017. "Outsourcing with identical suppliers and shortest-first policy: a laboratory experiment," Theory and Decision, Springer, vol. 82(4), pages 597-615, April.
    11. Cole, Richard & Correa, Jose & Gkatzelis, Vasillis & Mirrokni, Vahab & Olver, Neil, 2015. "Decentralized utilitarian mechanisms for scheduling games," LSE Research Online Documents on Economics 103081, London School of Economics and Political Science, LSE Library.
    12. Yamashita, Takuro, 2015. "Strategic and structural uncertainty in robust implementation," Journal of Economic Theory, Elsevier, vol. 159(PA), pages 267-279.
    13. Maurice Salles, 2006. "La théorie du choix social : de l'importance des mathématiques," Economics Working Paper Archive (University of Rennes & University of Caen) 200617, Center for Research in Economics and Management (CREM), University of Rennes, University of Caen and CNRS.
    14. Halati, Abolhassan & He, Yuanjie, 2010. "Analysis of supply chains with quantity based fixed incentives," European Journal of Operational Research, Elsevier, vol. 202(1), pages 214-222, April.
    15. Beatrice Cherrier & Jean-Baptiste Fleury, 2017. "Economists’ interest in collective decision after World War II: a history," Public Choice, Springer, vol. 172(1), pages 23-44, July.
    16. Roberto Serrano, 2003. "The Theory of Implementation of Social Choice Rules," Working Papers 2003-19, Brown University, Department of Economics.
    17. Gabrielle Demange, 2018. "Mechanisms in a Digitalized World," CESifo Working Paper Series 6984, CESifo.
    18. Hoffmann, Timo & Renes, Sander, 2016. "Flip a coin or vote: An Experiment on Choosing Group Decision Rules," VfS Annual Conference 2016 (Augsburg): Demographic Change 145474, Verein für Socialpolitik / German Economic Association.
    19. Hoffmann, Timo & Renes, Sander, 2016. "Flip a coin or vote : an Experiment on choosing group decision," Working Papers 16-11, University of Mannheim, Department of Economics.
    20. Vasilis Gkatzelis & Konstantinos Kollias & Tim Roughgarden, 2016. "Optimal Cost-Sharing in General Resource Selection Games," Operations Research, INFORMS, vol. 64(6), pages 1230-1238, December.
    21. Li, Linqiu & Liu, Ke, 2020. "Coordination contract design for the newsvendor model," European Journal of Operational Research, Elsevier, vol. 283(1), pages 380-389.

    More about this item

    Keywords

    Game theory; Outsourcing; Scheduling; Efficiency; Implementation; Nash equilibrium; Correlated equilibrium; Price of stability;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D71 - Microeconomics - - Analysis of Collective Decision-Making - - - Social Choice; Clubs; Committees; Associations
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:mathme:v:89:y:2019:i:2:d:10.1007_s00186-018-0645-1. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.