Volume 54, Number 4, July-August 2020
|Page(s)||1057 - 1075|
|Published online||20 May 2020|
Decision policies on players’ different risk combination under supplier encroachment
College of Management and Economics, Tianjin University, 300072 Tianjin, PR China
* Corresponding author: firstname.lastname@example.org
Accepted: 27 March 2019
Literature concerning about the supply chain management problem is usually based on perfect rationality. However, risk preferences have been proved to be an important role which influences managers’ decisions significantly. This paper investigates a risk combination problem under supplier encroachment with different risk preferences players. Assuming that the supply chain players may be risk-averse, risk-neutral and risk-taking, we build a Stackelberg game model to explore the optimal decisions and the impact of different risk combinations, respectively. We focus on two scenarios: the consumers perceive uniform quality between the two channels and perceive differentiated quality between the two channels. We find that the retailer always prefers a risk-averse supplier, while the supplier always prefers a risk-taking retailer. But the combination of a risk-averse supplier and a risk-taking retailer is not always beneficial to the whole supply chain. Further, we conduct numerical experiments to explore the risk combinations and the impacts of players’ selfish, aggressive and altruistic behaviors on optimal decisions.
Mathematics Subject Classification: 90B50 / 91A30
Key words: Supply chain management / supplier encroachment / risk preferences / Stackelberg game
© EDP Sciences, ROADEF, SMAI 2020
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