Pricing and Service Quality Guarantee Decisions in Logistics Service Supply Chain with Fairness Concern

Ni Du and Qinglan Han ()
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Ni Du: School of Business, Central South University, Changsha, P. R. China2College of Engineering, Hunan Agricultural University, Changsha, P. R. China
Qinglan Han: School of Business, Central South University, Changsha 410083, P. R. China

Asia-Pacific Journal of Operational Research (APJOR), 2018, vol. 35, issue 05, 1-41

Abstract: Although existing contributions that explore service quality guarantee problem of a logistic service supply chain (LSSC) consider fairness concern behavior of one member, little attention is paid to considering the combination of members’ fairness concern and the joint decision of pricing and service quality guarantee in LSSC. Therefore, it is necessary to research how different fairness concern affects the joint decision of pricing and service quality guarantee in an LSSC. First considering a price and quality-sensitive logistics service market, a basic model without fairness concern of a customized LSSC is established. Then, a new model with fairness concern of a decentralized LSSC is constructed based on the basic model. The optimal decision of the LSSC with fairness concern is investigated in three cases. In each case, we analyze the effect of fairness concern on the optimal decision, and the expected profits and utilities. Finally, some numerical studies are shown to verify our theoretical analyses and some managerial insights are given.

Keywords: Logistics service supply chain; pricing; service quality defect rate guarantee; fairness concerns; Stackelberg game (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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DOI: 10.1142/S0217595918500367

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