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Price and location competition in supply chain with horizontal altruistic retailers

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  • Zhibing Lin

    (Fuzhou University)

Abstract

We consider a supply chain model with one manufacturer and two altruistic retailers, where the manufacturer first chooses the wholesale price, then the retailers determine the location and retail price simultaneously. We analyze each firm’s strategies and the consequences for market demand, profit and consumer surplus. We find that the altruistic preferences play a key role in equilibrium outcomes. Specially, altruistic preferences could improve the profits of firms under certain conditions. Furthermore, we show that the supply chain can be coordinated with the derivative version of revenue sharing contract. Finally, we employ numerical analysis to demonstrate more managerial insights.

Suggested Citation

  • Zhibing Lin, 2019. "Price and location competition in supply chain with horizontal altruistic retailers," Flexible Services and Manufacturing Journal, Springer, vol. 31(2), pages 255-278, June.
    • Handle: RePEc:spr:flsman:v:31:y:2019:i:2:d:10.1007_s10696-018-9318-x
    DOI: 10.1007/s10696-018-9318-x
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    Cited by:

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    2. Guangxing Wei & Linrong Zhou & Binta Bary, 2022. "Operational Decision and Sustainability of Green Agricultural Supply Chain with Consumer-Oriented Altruism," Sustainability, MDPI, vol. 14(19), pages 1-25, September.

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