Study On Cooperation Relation Between Retailers And Suppliers Based On Evolution Game Theory

Based on the evolutionary game theory, the author analyzes and explains the dynamicevolution of cooperation relationship between suppliers and retailers in the supply chain.From a dynamic perspective, the author tries to help suppliers and retailers analyze thecompetition power of one cooperation strategy and its market developing trend, and thushelp them choose the right cooperation strategies and guide the development of market.At first, this paper introduces the cooperation relationship of retailers and suppliers,and analyses the conflict between them in the current. And summarizes the current studiesof inter promoting strategy about the cooperation relationship of retailers and suppliers.Focusing on the relationship of retailers and suppliers, the article establishes game payoffmatrix basing on the two parties’ cooperation under marketing environment, andestablishes different evolutionary game theory models basing on different cooperationstrategies taken by retailers and suppliers. Through analyzing the local stability ofsimultaneous differential equations, the author gives the ultimate stable equilibrium stateof the R&S system and draws the dynamic evolution process maps of the system. Basingon this evolutionary game theory model, and focusing on the market size function’scontour line of both sides of the game, this paper makes comprehensive analysis of theexcess profit and risk cost and finds the final evolutionary direction of the both sizes, so asto help the game party to choose rational cooperation strategy and leads the developmentdirection of market. Finally, the paper gives a further multi-pronged strategy of theevolutionary game theory model.