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Consumer Panic Buying: Realizing Its Consequences and Repercussions on the Supply Chain

Author

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  • Rithika Dulam

    (Technology Management for Innovation, The University of Tokyo, Tokyo 113-8654, Japan)

  • Kazuo Furuta

    (Technology Management for Innovation, The University of Tokyo, Tokyo 113-8654, Japan)

  • Taro Kanno

    (Systems Innovation, The University of Tokyo, Tokyo 113-8654, Japan)

Abstract

Globalization has brought not only advantages but also risks into the supply chains. One lesser studied risk is the effect of consumer behavior in crises. The recent COVID-19 pandemic has shown that the most efficient and optimized supply chains are susceptible to consumer panic buying. There is a severe need to understand the multitude of scenarios that could manifest after a catastrophe due to the change in consumer behavior so that businesses can develop a mitigation plan. The authors have developed an agent-based model that can simulate the various outcomes of a crisis using a consumer panic buying model and a supply chain model. The model quantitatively evaluates the panic purchase intention of a consumer while assessing the impact of panic buying on the supply chain. This paper introduces the implementation of the model, focusing on output analysis of the various situational settings in disaster aftermath. Preliminary study has revealed that implementing quota policy or rationing uniformly is very effective while controlling media reports or panic buying consumers can reduce consumer demand significantly.

Suggested Citation

  • Rithika Dulam & Kazuo Furuta & Taro Kanno, 2021. "Consumer Panic Buying: Realizing Its Consequences and Repercussions on the Supply Chain," Sustainability, MDPI, vol. 13(8), pages 1-24, April.
    • Handle: RePEc:gam:jsusta:v:13:y:2021:i:8:p:4370-:d:536000
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    References listed on IDEAS

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    2. Jamalzadeh, Saeed & Mettenbrink, Lily & Barker, Kash & González, Andrés D. & Radhakrishnan, Sridhar & Johansson, Jonas & Bessarabova, Elena, 2024. "Weaponized disinformation spread and its impact on multi-commodity critical infrastructure networks," Reliability Engineering and System Safety, Elsevier, vol. 243(C).
    3. Christopher M. Durugbo & Zainab Al-Balushi, 2023. "Supply chain management in times of crisis: a systematic review," Management Review Quarterly, Springer, vol. 73(3), pages 1179-1235, September.
    4. Ali, Maged & Gomes, Lucas Moreira & Azab, Nahed & de Moraes Souza, João Gabriel & Sorour, M. Karim & Kimura, Herbert, 2023. "Panic buying and fake news in urban vs. rural England: A case study of twitter during COVID-19," Technological Forecasting and Social Change, Elsevier, vol. 193(C).
    5. Qing-Hua Mao & Jiang-Xiao Hou & Peng-Zhen Xie, 2022. "Dynamic Impact of the Perceived Value of Public on Panic Buying Behavior during COVID-19," Sustainability, MDPI, vol. 14(9), pages 1-15, April.
    6. Mina Angelova & Teofana Dimitrova & Daniela Pastarmadzhieva, 2021. "The Effects of Globalization: Hyper Consumption and Environmental Consumer Behavior during the Covid-19 Pandemic," International Journal of Economics & Business Administration (IJEBA), International Journal of Economics & Business Administration (IJEBA), vol. 0(4), pages 41-54.
    7. Mohammad Alamgir Hossain & Md. Maruf Hossan Chowdhury & Ilias O. Pappas & Bhimaraya Metri & Laurie Hughes & Yogesh K. Dwivedi, 2023. "Fake news on Facebook and their impact on supply chain disruption during COVID-19," Annals of Operations Research, Springer, vol. 327(2), pages 683-711, August.
    8. Guohua He & Zirun Hu, 2022. "A Model of Panic Buying and Workforce under COVID-19," IJERPH, MDPI, vol. 19(24), pages 1-14, December.
    9. Jui-Lung Chen & Siriwat Prommetta, 2022. "A Discussion on University Students’ Online Shopping Behaviors Amid the COVID-19 Pandemic," Advances in Management and Applied Economics, SCIENPRESS Ltd, vol. 12(3), pages 1-1.
    10. Chen, Tinggui & Jin, Yumei & Yang, Jianjun & Cong, Guodong, 2022. "Identifying emergence process of group panic buying behavior under the COVID-19 pandemic," Journal of Retailing and Consumer Services, Elsevier, vol. 67(C).
    11. Irineu de Brito Junior & Hugo Tsugunobu Yoshida Yoshizaki & Flaviane Azevedo Saraiva & Nathan de Campos Bruno & Roberto Fray da Silva & Celso Mitsuo Hino & Larissa Limongi Aguiar & Isabella Marrey Fer, 2023. "Panic Buying Behavior Analysis according to Consumer Income and Product Type during COVID-19," Sustainability, MDPI, vol. 15(2), pages 1-17, January.

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