Equilibrium analysis in multi-echelon supply chain with multi-dimensional utilities of inertial players

Gajanan Panchal (), Vipul Jain (), Naoufel Cheikhrouhou and Matthias Gurtner
Additional contact information
Gajanan Panchal: National University of Singapore
Vipul Jain: Victoria University of Wellington
Matthias Gurtner: Ecole Polytechnique Fédérale de Lausanne

Journal of Revenue and Pricing Management, 2017, vol. 16, issue 4, No 6, 417-436

Abstract: Abstract In a supply chain, the importance of information elicitation from the supply chain players is vital to design supply chain network. The rationality and self-centredness of these players causes the information asymmetry in the supply chain and thus situation of conflict and non-participation of the players in the network design process. In such situations, it is required to analyse the supply chain players’ behaviour in order to explore potential for coordination through incentives. In this paper, a novel approach of social utility analysis is proposed to elicit the information for supply chain coordination among the supply chain players in a dyadic relationship – supplier and buyer. In principal, we consider a monopsony situation where buyer is a dominant player. With the objective of maximizing the social utility, efforts have been made to value behavioural issues in supply chain. On the other hand, the reluctance of player due to the information asymmetry is measured in the form of inertia – an offset to the supply chain profit. The suppliers’ behaviour is analysed with three distinct level of risk for two types of the product in procurement process. The useful insight from this paper is in supplier selection process where the reluctance of supplier offsets supply chain profit. The paper provides recommendations to supply chain managers for efficient decision-making ability in supplier selection process.

Keywords: dyadic supply chain relationship; supply chain formation; revenue management; supply chain coordination; supply chain player behavior (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://link.springer.com/10.1057/s41272-017-0094-0 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pal:jorapm:v:16:y:2017:i:4:d:10.1057_s41272-017-0094-0

Ordering information: This journal article can be ordered from
https://www.palgrave.com/gp/journal/41272

DOI: 10.1057/s41272-017-0094-0

Access Statistics for this article

Journal of Revenue and Pricing Management is currently edited by Ian Yeoman

More articles in Journal of Revenue and Pricing Management from Palgrave Macmillan
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().