Managing Supplier Switching
研究采购方如何最优地引入第二供应商，利用成本相关性限制原供应商的租金，并发现即使新供应商成本更高，替换原供应商也可能是最优的。
To examine the potential gains from a second production source, we examine how source switching is optimally structured. The model focuses on a purchaser who manages the acquisition process, an incumbent supplier, and a potential entrant or second supplier. Because the costs of the incumbent and second source are correlated, the entrant's costs provide an informative signal about the incumbent's costs. Judicious use of this information allows the purchaser to limit the incumbent's rents. Because entry also provides an alternative source of production, however, there are important distinctions between the optimal entry policy and the optimal auditing policy. One of our findings is that it may be optimal to replace the incumbent, even when the entrant is known to have higher production costs.