Two‐sided networks coordination for manufacturing technology standards' diffusion from home to host countries: A one‐leader and multiple‐followers Stackelberg game with multiple objectives

Qing Zhou, Zhengyi Wu, Wenchong Chen, Wenqing Chen and Yao Liang

Managerial and Decision Economics, 2024, vol. 45, issue 4, 2108-2129

Abstract: An optimization model is necessary to depict and induce the volatility and irregularity of manufacturing technology standard (MTS) diffusion processes to ensure that the standard can be widely adopted by related stakeholders in host countries. This paper clarifies the two‐sided network coordination of MTS's transactional diffusion, consisting of new product diffusion among users and new technology diffusion among local suppliers. A procurement contract is introduced to connect and coordinate the two‐sided networks. The manufacturer from the home country is responsible for the contract design, which aims to maximize its net revenue by considering the product diffusion processes. Local suppliers determine whether to accept the contract. The decision‐making objectives of the contract acceptance for each local supplier are to maximize the net revenue and minimize workload fluctuation. The new standard‐based products are produced and sold by the manufacturer. The corresponding local supplier adopts new standard‐based technologies and supplies components for final product production if a contract is accepted. Therefore, a one‐leader and multiple‐follower Stackelberg game is proposed to figure out the best solution after coordinating the multiple objectives of each participant. The contract design and the contract acceptance are the leader and the follower, respectively. Analytical solutions under a specific MTS for refrigerator production are developed incorporating a nested Non‐dominated Sorting Genetic Algorithm‐II. The results demonstrate that the proposed method can efficiently coordinate the two‐sided networks of MTS diffusion and balance the net revenue of all related stakeholders.

Date: 2024
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https://doi.org/10.1002/mde.4121

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Persistent link: https://EconPapers.repec.org/RePEc:wly:mgtdec:v:45:y:2024:i:4:p:2108-2129

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