Competitive pricing decisions in a two-echelon supply chain with horizontal and vertical competition

Cheng-Han Wu, Chieh-Wan Chen and Chung-Chi Hsieh

International Journal of Production Economics, 2012, vol. 135, issue 1, 265-274

Abstract: This study investigates the pricing decisions in a non-cooperative supply chain that consists of two retailers and one common supplier. The retailers order from the common supplier and compete in the same market. We analyze six power structures that characterize exclusively horizontal competition between the retailers and vertical competition between the supplier and the retailers, leading to different sequences of moves among the chain members. We derive the analytical forms of the equilibrium quantities under each power structure and explore the effect of retail substitutability on the equilibrium quantities among all power structures. We further investigate the performances of the game models as compared with the integrated model.

Keywords: Game theory; Non-cooperative game; Price competition; Sequence of moves; Supply chain management (search for similar items in EconPapers)
Date: 2012
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Citations: View citations in EconPapers (49)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:proeco:v:135:y:2012:i:1:p:265-274

DOI: 10.1016/j.ijpe.2011.07.020

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