Subsidies or taxes? Promoting new technology adoption in a supply chain.

Abstract

This paper focuses on the adoption of new technologies in a chain supply. It does emphasis in the problem of the double marginalization. This work from a model of vertical monopoly chain answers to two important questions: Firstly, what discount is necessary in order to keep constant the benefits of the Company A? Secondly, how much is Company B ready to pay, so thus Company A acquires the new technology? The model concludes that the companies are interested in acquiring the new technology, due to the profit increase and the reduction of the problem of the double marginalization. This work also proposes an experiment to realize in a future.