Research on Supply Chain Quality Decision Model Considering Reference Effect and Competition under Different Decision-Making Modes

Minglin Jiang, Xiaowei Lin (), Xideng Zhou () and Hongfang Qiao
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Minglin Jiang: Business School, Minnan Normal University, Zhangzhou 363000, China
Xiaowei Lin: Business School, Minnan Normal University, Zhangzhou 363000, China
Xideng Zhou: School of Economics and Management, Yuzhang Normal University, Nanchang 330099, China
Hongfang Qiao: Business School, Minnan Normal University, Zhangzhou 363000, China

Sustainability, 2022, vol. 14, issue 16, 1-20

Abstract: The reference effect of consumers’ product quality and service quality is an important behavioral factor that affects consumers’ purchase decisions. In this paper, considering the inherent dynamics of the operation mode, the two were combined into a product-service supply chain composed of a manufacturer and two competitive retailers, and the service reference effect was further divided into horizontal and vertical service reference effects. Differential game models between the manufacturer and the retailers were constructed. Using the continuous dynamic programming theory, the manufacturer’s quality level strategy, retailer’s service level strategy and supply chain system performance under the modes of no cost sharing decision, cost sharing decision and centralized decision were analyzed and compared. Main findings: The optimal strategy of product quality under centralized decision is greater than the corresponding value under cost sharing contract decision. Compared with decentralized decision making of no cost sharing, cost sharing contract cannot promote the manufacturer to improve product quality. Different from previous studies, the service quality under centralized decision making is not higher than other decisions. When the horizontal reference effect of service quality meets a certain condition, the supply chain profit under centralized decision making is lower than the corresponding value under decentralized decision making.

Keywords: reference effect; product quality; service quality; differential game (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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