Analysis of the Bullwhip Effect Phenomenon Based on Principal-Agent Theory

High efficient supply chain management can help the enterprise develop quickly, build kernel competition capacity, and challenge the uncertain market demand and the renovation of the technology. However, the bullwhip effect which exists universally in the supply chain management affects the efficiency of the total operation of the supply chain. This paper analyzes the bullwhip effect phenomenon by the principal-agent theory, then builds a two-phase math supply chain model in the case of asymmetric information and studies the information sharing problem with the principal-agent theory. The results show that the producer can spirit up the retailer by price discount, market reassigning, and allowance etc