Untruthful probabilistic demand forecasts in vendor‐managed revenue‐sharing contracts: Coordinating the chain

Vendor‐managed revenue‐sharing arrangements are common in the newspaper and other industries. Under such arrangements, the supplier decides on the level of inventory while the retailer effectively operates under consignment, sharing the sales revenue with his supplier. We consider the case where the supplier is unable to predict demand, and must base her decisions on the retailer‐supplied probabilistic forecast for demand. We show that the retailer's best choice of a distribution to report to his supplier will not be the true demand distribution, but instead will be a degenerate distribution that surprisingly induces the supplier to provide the system‐optimal inventory quantity. (To maintain credibility, the retailer's reports of daily sales must then be consistent with his supplied forecast.) This result is robust under nonlinear production costs and nonlinear revenue‐sharing. However, if the retailer does not know the supplier's production cost, the forecast “improves” and could even be truthful. That, however, causes the supplier's order quantity to be suboptimal for the overall system. © 2007 Wiley Periodicals, Inc. Naval Research Logistics, 2007     

INTRA‐GROUP COMPETITION AND INTER‐GROUP CONFLICT: AN APPLICATION TO NORTHERN IRELAND

This paper reviews four economic theories of leadership selection in conflict settings. The ‘credibility rationale’, argues that hawks may actually be necessary to initiate peace agreements. The ‘bargaining rationale’ predicts that while doves are more likely to secure peace, post‐conflict hawks may be rationally selected. The ‘social psychological rationale’ captures the idea of a competition over which group can form the strongest identity. Dove selection can be predicted during conflict, but hawk selection post‐conflict. Finally, the ‘expressive rationale’ predicts that regardless of the underlying nature of the game the large group nature of decision‐making in rendering individual decision makers non‐decisive in determining the outcome of elections may cause them to make choices based primarily on emotions. Finally, the paper analyses the extent to which the theories can throw light on Northern Ireland electoral history over the last 25 years.     

Army reconstruction in the Democratic Republic of the Congo 2003–2009

Since the peace agreements of 2002–2003 which ended the second war in the Democratic Republic of Congo, reconstruction of the army has been an inherently political process, in common with other attempts to carry out security sector reform (SSR). This article briefly sketches out the Congolese army's history, then attempts to fill a gap in the literature on Congolese SSR by detailing what can be found of the actual structure and shape of the present army. The efforts that have been made to reform the army are then examined, followed by a conclusion which examines the major issues and possible ways forward.     

Information Is Not a Weapons System

ABSTRACT

While many militaries have tried to capitalize on the potential of information operations in internal war, few have succeeded. I argue that military information campaigns fall short of expectations for two reasons. First, the theory of influence militaries generally embrace – communications as a non-lethal weapons system – is largely invalid. While treating information as a weapons system makes it easier to integrate it into the existing military planning system, this overstates the independent effects of communications on behavior and understates the importance of interactive effects of what commercial marketing theory refers to as the “marketing mix” – product, price, promotion, and placement. It would be more appropriate to treat military information operations as a form of marketing: a composite effort to induce a specific behavior in a target audience by applying a combination of material and ideational instruments. The marketing model suggests that the efficacy of information operations will depend not simply on the message and its delivery (promotion) but on the behavior the sender seeks to induce (the product), the costs of that behavior (the price), and the opportunities available for such behavior (the placement).     

Book reviews

Over the last 18 years or so, much of the debate about modern warfare has been about whether it should be described as ‘old’ or ‘new’. However, there has not been a definitive answer as to which best reflects war in the modern world. Increasingly, the alternative arguments are polarised into opposing camps. Indeed, it would be fair to say that there is little in the way of debate at all. By revaluating the strengths and weaknesses of each argument, this paper aims to reinvigorate that discussion by examining whether changes in the way we understand war are really required. Finding that the ideas are not in fact mutually exclusive, it suggests that future research could benefit from a combined approach.     

Japan's plutonium policy: Consequences for nonproliferation

ABSTRACT

What do we mean by nuclear proliferation? What does it mean to proliferate? This article investigates both the literal and figurative meaning of the term “proliferation.” It argues that many of the definitions and conceptualizations of nuclear proliferation often used by scholars are either limited in their utility or logically inconsistent. It then reconceptualizes and redefines the term, incorporating an understanding of both its etymological origins and the geopolitical context in which the phenomenon occurs. It concludes by exploring the potential impact that the politicization of the phenomenon may have on the identification of occurrences of proliferation, from both an academic and a policy-making perspective.     

A bayesian approach to evaluating military investments in product improvement and testing

Two issues of frequent importance in new product development are product improvement and reliability testing. A question often faced by the developer is: Should the product be distributed in its present state, or should it be improved further and/or tested before distribution? A more useful statement of the question might be: What levels of investment in further improvement and testing are economically permissible? Products for which this question is relevant may vary widely in type and intended use. This paper presents a model for determining these levels for one such product—an equipment modification procedure. The model presented makes use of present value analysis to compare cost streams and of Bayesian statistics to relate the costs to various outcomes under conditions of uncertainty. The model is applied to an actual military problem and a method is described for examining the sensitivity of the results to changes in the prior probabilities and discount rate.