A multi-period supply chain network equilibrium model considering retailers’ uncertain demands and dynamic loss-averse behaviors

Yan Zhou, Chi Kin Chan and Kar Hung Wong

Transportation Research Part E: Logistics and Transportation Review, 2018, vol. 118, issue C, 51-76

Abstract: This study constructs an equilibrium model of a multi-period supply chain network with uncertain demand. In the multi-period equilibrium model, we consider not only retailers’ static loss-averse behaviors, but also their dynamic loss-averse behaviors, in which retailers dynamically adjust their loss-averse parameters according to their gains or losses over the production periods. The equilibrium conditions of the various decision makers and the network are established by the finite-dimensional variational inequality. Finally, numerical examples are solved to show how retailers’ loss-averse behaviors would affect decisions, profits of manufacturers and utilities of retailers at equilibrium when compared with their loss-neutral behaviors.

Keywords: Supply chain; Uncertain demand; Dynamic loss-averse behavior (search for similar items in EconPapers)
Date: 2018
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Citations: View citations in EconPapers (11)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:transe:v:118:y:2018:i:c:p:51-76

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DOI: 10.1016/j.tre.2018.06.006

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