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Optimal Financing Decisions of Two Cash-Constrained Supply Chains with Complementary Products

Author

Listed:
  • Yuting Li

    (College of Management and Economics, Tianjin University, Tianjin 300072, China)

  • Tong Chen

    (College of Management and Economics, Tianjin University, Tianjin 300072, China)

  • Baogui Xin

    (College of Economics and Management, Shandong University of Science and Technology, Qingdao 266590, China)

Abstract

In recent years; financing difficulties have been obsessed small and medium enterprises (SMEs); especially emerging SMEs. Inter-members’ joint financing within a supply chain is one of solutions for SMEs. How about members’ joint financing of inter-supply chains? In order to answer the question, we firstly employ the Stackelberg game to propose three kinds of financing decision models of two cash-constrained supply chains with complementary products. Secondly, we analyze qualitatively these models and find the joint financing decision of the two supply chains is the most optimal one. Lastly, we conduct some numerical simulations not only to illustrate above results but also to find that the larger are cross-price sensitivity coefficients; the higher is the motivation for participants to make joint financing decisions; and the more are profits for them to gain.

Suggested Citation

  • Yuting Li & Tong Chen & Baogui Xin, 2016. "Optimal Financing Decisions of Two Cash-Constrained Supply Chains with Complementary Products," Sustainability, MDPI, vol. 8(5), pages 1-17, April.
    • Handle: RePEc:gam:jsusta:v:8:y:2016:i:5:p:429-:d:69266
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