Joint Investment and Pricing Decisions in a Mobile Game Supply Chain Considering Risk Attitudes

Jiali Qu, Jiawei Zhang, Benyong Hu and Chao Meng

Managerial and Decision Economics, 2025, vol. 46, issue 2, 891-909

Abstract: This paper studies the joint decision‐making problem of investment and pricing in a mobile game supply chain with a game developer and a distribution platform with different risk attitudes. The investment here involves the mobile game's quality investment during the development process and promotion investment during the operation process. First, the mean–variance utility theory is used to describe the risk attitudes of the supply chain participants. On this basis, considering the mobile game's individualized operational characteristics with respect to production and sales, the supply chain's and its participants' decision‐making models are established with the expected utility as an objective function. Second, the supply chain collaboration is modeled as a Stackelberg game. This paper obtains the optimal decisions of the participants and reveals the effects of the participants' risk attitudes on the optimal quality investment, promotion investment, and pricing policy. Finally, this paper further reveals the relationship between participants' risk attitudes and their expected profits. It is found that participants' risk attitudes will change the relationship between the expected profits under centralized decision‐making and those under decentralized decision‐making. These characteristics remain valid when a different demand format is employed or the supply chain members play a Nash game.

Date: 2025
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https://doi.org/10.1002/mde.4410

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Persistent link: https://EconPapers.repec.org/RePEc:wly:mgtdec:v:46:y:2025:i:2:p:891-909

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