Abstract

A common practice to address supply-demand mismatch is capacity sharing, whereby a firm possessing excessive capacity collaborates with its rival that is incapable of meeting captured demand. However, previous studies have seldom focused on the role of capacity sharing in shaping market competition. In this paper, we investigate coopetition strategies under two widely used contracting mechanisms of capacity sharing, namely, the linear transfer payment contracting mechanism and the revenue sharing contracting mechanism. In a model of two competitors with asymmetric capacities, we find that the larger firm becomes less aggressive in market competition and benefits more from capacity sharing. Competition between the firms will be softened by capacity sharing. Moreover, competition intensity is more likely to be higher under the linear transfer payment contracting mechanism than under the revenue sharing contracting mechanism, while it may be lower if the total capacities are slightly larger than the aggregate demand.

Keywords

capacity sharing · market competition · linear transfer payment · revenue sharing

本文于2019年在线发表于Omega。该期刊为经管院B+类期刊，JCR中MS/OR领域影响因子排名第二。王建成系方德斌教授指导的博士研究生。文章的网址链接：

https://www.sciencedirect.com/science/article/pii/S0305048319301100