Keynote Speakers

  • Xu Chen is Professor of operations and supply chain management at School of Management and Economics, University of Electronic Science and Technology of China, Chengdu, China. His current research interests include coopetition management, supply chain management, and operations management. His publications have appeared in Production and Operations Management, IISE Transactions, IIE Transactions, European Journal of Operational Research, OMEGA-International Journal of Management Science, Journal of Business Research, IEEE Transactions on Engineering Management, IEEE Transactions on Systems Man and Cybernetics: Systems, International Journal of Production Economics, International Journal of Production Research, Journal of the Operational Research Society, Annals of Operations Research, and other journals. His research has been supported by grants from the National Sciences Foundation of China (NSFC), Major Program of National Social Science Foundation of China (NSSFC), and National Key R&D Program of China.

    Abstract: Capacity sharing can effectively address the supply-demand mismatch by optimizing the capacity allocation of the participating manufacturers. To explore the effects of capacity sharing on consumers, manufacturers, and social welfare, we consider two manufacturers that produce and sell partially substitutable products in the market and explore two capacity sharing service fee policies, namely, a fixed lump-sum fee model and a mixture of fixed fee and unit rate model. By comparing the equilibrium profits in the two policies with the benchmark competition model, we find that the relative benefits of capacity sharing depend on the trade-offs between the increased profits and losses caused by intensified competition with the rival manufacturer. The benefits and losses associated with capacity sharing are influenced by several key factors, including the product substitution rate, the unit production cost difference between the two manufacturers, and interfirm bargaining power. We extend our analysis to the asymmetric case where the manufacturers’ maximum retail prices are not identical, further illustrating the impact of the market feature on firms’ decisions about capacity sharing.