Research on the Dynamic Pricing and Service Decisions in the Reverse Supply Chain considering Consumers’ Service Sensitivity

Jixiang Zhang and Chen Zhu
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Jixiang Zhang: College of Economics and Management, Nanjing University of Aeronautics and Astronautics, Nanjing 211106, China
Chen Zhu: College of Economics and Management, Nanjing University of Aeronautics and Astronautics, Nanjing 211106, China

Sustainability, 2020, vol. 12, issue 22, 1-21

Abstract: In this work, considering consumers’ service sensitivity for the third-party collector in the reverse supply chain, a game model (including a manufacturer and a third-party collector) with dual-channel recycling structure was established. Based on the bounded rationality, we used dynamics theory to analyze the dynamic service and pricing decisions of the manufacturer and the third-party collector in the process of collecting waste products. The results showed that adjustment speeds of pricing and service decisions have great effect on the stability of recycling market, and the recycling market is most sensitive to the change of third-party collectors’ service decision. When the recycling market is in chaos, it has a strong initial value sensitivity. In addition, we found that increase of consumers’ service sensitivity and service cost parameter had negative effect on stability of the recycling market; there is a reverse relationship between price adjustment parameters and the service adjustment parameter. With the increase of service adjustment parameter, the bifurcation point of the system will appear more quickly. Finally, chaotic market can be controlled by the feedback control method.

Keywords: pricing decision; service decision; dual-channel; bounded rationality; reverse supply chain (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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