Quality improvement policies in a supply chain with Stackelberg games. (English) Zbl 1406.91230

Xie, Gang; Yue, Wuyi; Wang, Shouyang

J. Appl. Math. 2014, Article ID 848593, 9 p. (2014).

Summary: We first analyze quality and price decisions in a supply chain with two Stackelberg games: Manufacturer’s Stackelberg (MS) and Supplier’s Stackelberg (SS). Then, we investigate how equilibrium solutions are influenced by proposed quality improvement policies: coordination and manufacturer’s involvement. Also, we derive the conditions under which the policies can be implemented in both MS and SS strategies. Numerical experiments illustrate the problems and several related issues are discussed. The results suggest that proposed quality improvement policies can realize Pareto improvement for the supply chain performance.

MSC:

91B38	Production theory, theory of the firm
91A80	Applications of game theory
91B06	Decision theory