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Coordinating a closed loop supply chain with fairness concern by a constant wholesale price contract
European Journal of Operational Research ( IF 6.0 ) Pub Date : 2021-03-02 , DOI: 10.1016/j.ejor.2021.02.052
Sumit Sarkar , Shrey Bhala

The literature on closed loop supply chains (CLSCs) has ignored advantageous inequality aversion while modelling the fairness concern of channel partners and demonstrated that coordinating a decentralised channel requires complex price contracts. In this paper, we show that a constant wholesale price contract can coordinate a decentralised channel in a manufacturer-led CLSC if the retailer's advantageous inequality aversion is sufficiently strong. The result is valid for a range of equitable shares of the channel profit, such that the allocated share of the manufacturer is larger than that of the retailer, and the retailer's share is greater than a minimum threshold. Used product collection rate and channel profit are higher when the retailer is inequality averse compared to when she is a profit maximiser. The results are independent of whether the end-of-use products are collected by the manufacturer or the retailer. We also show that the collection rate is higher, and both channel partners are better-off, under the manufacturer collection model. To obtain these results, we solve multistage sequential move games under the two collection models. We apply Karush–Kuhn–Tucker conditions for constrained optimisation, to determine the boundaries for the existence of the subgame perfect Nash equilibrium.



中文翻译:

通过固定批发价格合同协调具有公平性的闭环供应链

关于闭环供应链 (CLSC) 的文献在对渠道合作伙伴的公平问题进行建模时忽略了有利的不平等厌恶,并表明协调分散的渠道需要复杂的价格合同。在本文中,我们表明,如果零售商的有利不平等厌恶足够强烈,则恒定批发价格合同可以协调制造商主导的 CLSC 中的分散渠道。结果对于渠道利润的公平份额范围是有效的,使得制造商的分配份额大于零售商的份额,并且零售商的份额大于最小阈值。与利润最大化者相比,当零售商厌恶不平等时,二手产品回收率和渠道利润更高。结果与最终使用产品是由制造商还是零售商收集无关。我们还表明,在制造商收集模型下,收集率更高,两个渠道合作伙伴的状况都更好。为了获得这些结果,我们解决了两种收集模型下的多阶段顺序移动博弈。我们应用 Karush-Kuhn-Tucker 条件进行约束优化,以确定子博弈完美纳什均衡存在的边界。

更新日期:2021-03-02
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