Freshness-Keeping Strategy of Logistics Service Providers: The Role of the Interaction between Blockchain and Overconfidence

Hongbo Tu, Mo Pang and Lin Chen ()
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Hongbo Tu: School of Management, Wuhan Institute of Technology, Wuhan 430205, China
Mo Pang: School of Management, Wuhan Institute of Technology, Wuhan 430205, China
Lin Chen: School of Management, Wuhan Institute of Technology, Wuhan 430205, China

Mathematics, 2023, vol. 11, issue 17, 1-35

Abstract: As a result of the increasing scrutiny of fresh products, greengrocers are now forced to concern themselves with the deterioration of their products’ freshness and employ blockchain technology as a tracing system. However, in the logistics system, the third-party logistics service provider (LSP) is motivated to be overconfident in order to extract extra profits, thus intensifying the dilemma faced by the fresh agricultural product industry. This paper focuses on the association between blockchain technology and overconfidence, in which the third-party LSP is supposed to overestimate the effect of the retailer’s freshness keeping measures. Differing from the previous literature, we analyze a situation wherein blockchain technology is adopted with explicit execution. Based on the optimal control model, we obtained three main conclusions: First, the overconfidence of a third-party LSP does not damage the logistics system but changes the freshness-keeping strategy of the retailer. Second, interestingly, although blockchain technology performs effectively when it is adopted as an initially established system with a freshness keeping strategy, it is not always a wise decision for managers to adopt a blockchain, especially when adopting it as a countermeasure for overconfidence. Third, we found that blockchain technology has a greater effect on freshness-keeping than overconfidence. Thus, in the fresh agricultural product industry, managers should adopt blockchain technology before overconfidence occurs and pay more attention to exogenous prices and freight to decide whether to adopt blockchain technology.

Keywords: blockchain; overconfidence; third-party logistics service provider; freshness keeping; optimal control (search for similar items in EconPapers)
JEL-codes: C (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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