Research On Coordination Of Dynamic Risk-aversion Supply Chain Contracts

This paper studies static and dynamic coordination strategies of a two-stagesupply chain consisting of a leading supplier and a following retailer under the premiseof risk-neutral and risk-aversion, in stochastic demand environment.Under risk-neutral condition, according to the three criteria of coordinating supplychain: Nash equilibrium, Pareto optimal and any profit distribution, we establishstandard two-stage buyback contract model and revenue sharing contract model forproducts have rigid demand, short life cycle, low residual. In static case, we calculateexpressions of contract parameters, the optimal order quantity and profit distributioncoefficient. In dynamic case, we obtain the coordination strategy of the supply chainunder disturbance of any two factors out of supplier’s production cost, retailer’smarginal cost, and retail price. We calculate when and how to change system optimalorder quantity, and list the expression of contract parameters adapted to emergency.Under the premise of a loss aversion retailer, according to the two criteria ofcoordinating supply chain that has risk preference: to ensure members’ risk constraintsand Pareto optimal, we establish static and dynamic supply chain buybackcontract model and revenue sharing contract model. Firstly three commonly usedapproaches of risk appetite, including the mean-variance method, the utility functionmethod, the downside risk method, are studied. According to characteristics this article,we select utility function method to deal with the problem, and use loss aversion modelin prospect theory to establish static supply chain contract models. Then throughqualitative and quantitative analysis, we design contracts in two factors perturbationsituation satisfying criteria on the basis of the first two chapters.At the end of each chapter numerical examples verify the previous theoreticalanalysis and display conclusions in a more intuitive way. Pictures reveal the impact ofthe profit distribution coefficient in risk-neutral model and the loss aversion coefficientin loss aversion model on the entire system, and the relationship between variables andcontract parameters, members’ expected utilities under various perturbations.