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Credit payment strategies have been implemented widely in the online retail industry. This work studies an online-retail supply chain involving credit period and selling price-dependent demands. The participants of the supply chain form a Stackelberg game where the supplier as a follower sells products to the customers through an online platform provider, who as a leader provides a credit period to customers and charges the supplier based on the quantity of goods sold. We study and compare the supply chains when the online platform provider adopts the cash payment and credit payment strategies, respectively, to investigate the effects of the credit period, the selling price and the default risk on supply chain system performance. We also investigate these supply chains under both the centralized and decentralized settings and provide an example to illustrate a simple allocation mechanism to coordinate the decentralized supply chain. Finally, an extension of the supply chain with credit payment is given.

We derive a representation for the value process associated to the solutions of forward–backward stochastic differential equations in a jump-diffusion setting under multiple probability measures. Motivated by concrete financial problems, the latter representations are then applied to devise a generalization of the change of numéraire technique, allowing to obtain recursive pricing formulas in the presence of nonlinear funding terms due to e.g. collateralization agreements.

A weather derivative is financial instrument that companies or individuals use to hedge against the risk of weather-related losses. Freight derivatives value is derived from the future levels of freight rates, like a dry bulk-a category of cargo stowed in bulk, consisting of grain, cotton, coal, etc., carrying rates, and oil tanker rates.

Numerous empirical studies exist on weather and freight derivatives and their pricing models such as Indifference Pricing Approach, Arbitrage Pricing Model, Financial Pricing model, Benchmark Pricing Approach, Fair Pricing Approach, Actuarial Pricing, Consumer Based Pricing Method, and Index Modeling. This paper aims to address issues relating to the functioning of weather and freight derivatives.

This paper also focuses on the studies published on weather and freight derivatives’ pricing models during the last seven decades (i.e., 1950–2020).

Objectives:

• (1)To understand the vital issues relating to models of weather and freight derivatives.
• (2)To compare pricing models of weather and freight derivatives during the last seven decades (i.e., 1950–2020).