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Product subsidy and expected consumption with inventory inaccuracy: Implications of RFID adoption in Indian public distribution system
Computers & Industrial Engineering ( IF 7.9 ) Pub Date : 2021-07-02 , DOI: 10.1016/j.cie.2021.107527
Arun Kumar Biswal 1 , Mamata Jenamani 2 , Sri Krishna Kumar 2
Affiliation  

In countries that fight malnutrition and hunger, governments and international agencies sponsor subsidy programmes to improve consumption of staple food among the poor. Although the donors in such programmes provide product subsidy to make it affordable and accessible, the supply chain used to deliver these products to the end beneficiary is prone to losses and diversion. Intervention of advanced technologies like RFID, GPS, and GIS are likely to improve the efficiency and effectiveness of such systems. However, considering budget limitation, a key concern for the donors is to investigate how diversion of fund in favour of technology would impact the product subsidy and expected consumption. We model the situation as a price-taking and price-setting newsvendor who implements the subsidy programme, and a donor who provides funding, to investigate the issue. We perform numerical analysis using actual data concerning to the food security system of India and our results show that, for both the price-taking and price-setting situation, the system with RFID generates more consumption as compared to that of the non-RFID situation at same donor budget. We also find that, fixing the price at suitable level the donors could control the profit of the implementing firm, and could generate more consumption as compared to that of the price decontrol situation.



中文翻译:

库存不准确的产品补贴和预期消费:印度公共配送系统采用RFID的影响

在与营养不良和饥饿作斗争的国家,政府和国际机构赞助补贴计划,以改善穷人的主食消费。尽管此类计划中的捐助者提供产品补贴以使其负担得起且易于获得,但用于将这些产品交付给最终受益人的供应链很容易出现损失和转移。RFID、GPS 和 GIS 等先进技术的干预可能会提高此类系统的效率和有效性。然而,考虑到预算限制,捐助者的一个关键问题是调查资金转移到技术上会如何影响产品补贴和预期消费。我们将这种情况建模为价格接受和定价的报贩实施补贴计划的机构和提供资金的捐助者调查问题。我们使用有关印度食品安全系统的实际数据进行数值分析,我们的结果表明,对于定价和定价情况,与非 RFID 情况相比,有 RFID 的系统产生更多的消耗在相同的捐助者预算下。我们还发现,将价格固定在合适的水平上,捐赠者可以控制实施公司的利润,并且与价格取消控制的情况相比,可以产生更多的消费。

更新日期:2021-07-09
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