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A Stackelberg Equilibrium Model for Supply Chain Inventory Managemen

In: Perspectives on Operations Research

Author

Listed:
  • Yeong-Cheng Liou

    (Cheng Shiu University)

  • Siegfried Schaible

    (University of California)

  • Jen-Chih Yao

    (National Sun Yat-sen University)

Abstract

In this paper we consider one-buyer, one-seller, finite horizon, multi-period inventory models in which the economic order quantity is integrated with the economic production quantity (EOQ-EPQ in short). We introduce the Stackelberg equilibrium framework in which the objective is to maximize the vendor’s total benefit subject to the minimum total cost that the buyer is willing to incur. Some existence results, optimality conditions and the optimal replenishment policy under the Stackelberg equilibrium concept are obtained and a numerical algorithm is presented to find the optimal replenishment policy in practice.

Suggested Citation

  • Yeong-Cheng Liou & Siegfried Schaible & Jen-Chih Yao, 2006. "A Stackelberg Equilibrium Model for Supply Chain Inventory Managemen," Springer Books, in: Martin Morlock & Christoph Schwindt & Norbert Trautmann & Jürgen Zimmermann (ed.), Perspectives on Operations Research, pages 319-337, Springer.
    • Handle: RePEc:spr:sprchp:978-3-8350-9064-4_18
    DOI: 10.1007/978-3-8350-9064-4_18
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