Research on avoiding the moral hazard in supply chain by incentive-monitoring mechanism

Considering the issue of moral hazard of the single manufacturer with multiple distributors in supply chain, from the core enterprise-manufacturer's point of view, based on the theory of principal-agent, designing an incentive-monitoring mechanism which introduces encouragement and punishment, and analyzing some factors what can influence the optimum incentive degree and the optimum monitoring degree. This incentive-monitoring mechanism designed by this paper can effectively enhance the effort of distributors and availably avoid the moral hazard of distributors. This research will bring a new angle for researching the moral hazard of supply chain, it can offer a new analysis means for mending the incentive contract and monitoring mechanism of supply chain.